Secure Their Future Today with RESP: Because Their Dreams Deserve the Best!

Understanding Canada's Registered Education Savings Plan (RESP)

Unlock Your Child's Bright Future with Ease! Click the link below to get an illustration regarding RESP and see how simple saving for their education can be.

A Registered Education Savings Plan (RESP) is a special savings account designed to help Canadian families save for their children's post-secondary education. With government grants and tax-sheltered growth, RESPs are a popular choice for education savings.

What is an RESP?

  • Tax-Sheltered Growth: Investments within an RESP grow tax-free until withdrawn.
  • Government Grants: The government provides grants to boost your savings, including the Canada Education Savings Grant (CESG).
  • Contribution Limits: There is no annual limit on contributions, but there is a lifetime limit of $50,000 per beneficiary.

Benefits of an RESP

  • Government Contributions: The CESG matches 20% of annual contributions up to $500 per year, with a lifetime maximum of $7,200 per child.
  • Additional Grants: Low-income families may qualify for additional grants such as the Canada Learning Bond (CLB).
  • Tax Deferral: Earnings on contributions and government grants are not taxed until withdrawn for educational purposes.
  • Flexibility: Funds can be used for various types of post-secondary education, including university, college, and trade schools.

How to Open an RESP

  • Choose a Provider: Banks, credit unions, and investment firms offer RESP accounts.
  • Select a Plan: Decide between individual plans, family plans, or group plans based on your needs.
  • Start Contributing: Make regular contributions to maximize government grants and tax-sheltered growth.

Types of RESPs

  • Individual Plan: Designated for one beneficiary. Anyone can contribute.
  • Family Plan: Can have multiple beneficiaries, all related by blood or adoption.
  • Group Plan: Pooled with contributions from multiple investors, managed by scholarship plan dealers.

Withdrawal Rules

  • Educational Assistance Payments (EAPs): Withdrawals for education costs. These include grants and investment earnings, taxed in the student'’'s hands.
  • Post-Secondary Education (PSE) Withdrawals: Withdrawals of your original contributions, not taxed.
  • Non-Educational Withdrawals: If the child does not pursue post-secondary education, contributions can be withdrawn without tax, but grants must be returned, and earnings may be subject to taxes and penalties.


  • Purpose: RESPs are specifically for education savings, while TFSAs and RRSPs serve broader purposes like retirement and general savings.
  • Government Grants: Only RESPs offer government education savings grants.


An RESP is an excellent way to save for a child's post-secondary education, offering tax-sheltered growth and valuable government grants. Understanding the rules and benefits can help you make the most of this powerful savings tool. Always consider speaking with a financial advisor to tailor your RESP strategy to your personal needs and circumstances.


Still not sure what to do? Here is a list of our FAQ's; click the question to unveil the answer

How much can I contribute to an RESP?


There is no annual contribution limit, but the lifetime limit is $50,000 per beneficiary.

What is the Canada Education Savings Grant (CESG)?


The CESG provides 20% on the first $2,500 contributed each year, up to $500 annually and a lifetime maximum of $7,200 per child.

Can I open an RESP for any child?


Yes, you can open an RESP for any child, including your own children, grandchildren, nieces, nephews, or even a friend's child.

What happens if my child doesn’t go to post-secondary education?


If the child does not pursue post-secondary education, contributions can be withdrawn without tax, but any government grants must be returned, and earnings may be subject to taxes and penalties.

Are there any fees associated with RESPs?


Yes, some financial institutions may charge account setup fees, annual maintenance fees, or withdrawal fees. It’s important to check with your provider.

Can more than one person contribute to an RESP?


Yes, parents, grandparents, and other relatives or friends can contribute to an RESP for the same beneficiary.

How long can I keep an RESP open?


An RESP can remain open for up to 36 years (or up to 40 years for a specified plan for a beneficiary with a disability).

What types of education can RESP funds be used for?


RESP funds can be used for various post-secondary education programs, including university, college, CEGEP, trade schools, and certain other certified programs.

How are RESP withdrawals taxed?


Educational Assistance Payments (EAPs) are taxed in the hands of the student, who typically has a lower income and may pay little to no tax. Original contributions are not taxed upon withdrawal.