Registered Education Savings Plan

Registered Education Savings Plan (RESP)

A segregated fund contract offers protective features including death benefit and maturity guarantees.

Helping to fund a child’s post-secondary education is one of the most important investments you can make in their future, especially in today’s competitive environment where a good education is crucial to success. Yet, with the rising cost of tuition fees and living expenses, personal savings alone may not be enough to cover the cost of higher education. Choose your provider wisely, consider a company that is reputable and financially strong.

What You Should Know

  • A Registered Education Savings Plan (RESP) is a flexible and convenient way to save for a child’s future education.
  • Government incentives are available to qualified Student Beneficiaries to help RESP savings grow.
  • When withdrawn, plan growth and government grants can be taxed at the student’s tax rate (he or she could pay little or no tax on this money).
  • There is no annual contribution limit with an RESP, but the lifetime maximum is $50,000 per Student Beneficiary.
  • Anyone can open an RESP – parents, guardians, grandparents, other relatives, or friends.
  • Investment income generated in an RESP is tax-sheltered as long as it remains in the plan.

Government Grants Available With RESPs

  • Basic Canada Education Savings Grant (CESG)
  • The Additional CESG
  • The Canada Learning Bond

Since an RESP can remain open for up to 36 years (40 years for a Specified Plan), it’s important to choose your provider wisely. Consider a company that is reputable and financially strong. When the child begins receiving money from the RESP, the provider will, after all, be responsible for making the payments according to your plan’s terms.