Registered education savings plans (RESPs)

An RESP is probably the best way to save for a child's or grandchild's post-secondary education.

Why invest in an RESP today? 

• government grants
• tax deferral, and
• the advantages of saving early for a child's future.
  

Here are a few facts:

• Parents, grandparents and friends can contribute money to an RESP – to a lifetime total of $50,000 per child.
• RESP contributions are not tax deductible. However, any investment income you earn within the plan is not taxed until it's withdrawn.
• The federal government adds a Canada Education Savings Grant (CESG) of 20% of what you put in, up to $500 per year to a lifetime maximum of $7,200 for each child. Contributors with a lower family income receive a higher grant. For details on additional grants you can receive, visit CESG

Types of RESPs available

Family RESP plans

• You can name one or more children as beneficiaries, but they must be related to you.
• Beneficiaries must be siblings of one another to receive the CESG and some provincial grants (i.e., Alberta Centennial Education Savings Plan in the province of Alberta).
• Children, grandchildren, adopted children and stepchildren are fully eligible.
• If the older children don't go to school, you can transfer the grant money, under certain circumstances, to other beneficiaries.
• You don't have to split payments evenly between children.

Individual RESP plans

• These plans can be opened by anyone -- the planholder doesn't have to be a close relative.
• There are no age limits, so you can set up an RESP for yourself or another adult.

In both types of Registered Education Savings Plans the planholder fully controls:

• how the money is invested, and
• the timing, amount and frequency of payments to the beneficiary.

For more information, please visit RESP .

• Understanding investments
• Building your savings
  • Guaranteed investment certificates (GICs)
  • Accumulation annuities (AAs)
  • Mutual Funds
  • Segregated funds
  • Registered education savings plans (RESPs)
  • RRSPs
  • Tax-Free Savings Account (TFSA)
  • Sun Market Linked GICs
• Enjoying your retirement income
• Workplace pensions and savings