RESP (Registered Education Savings Plan)
With the ever-increasing cost of education, saving is one way to ensure your children realize their full potential. A Registered Education Savings Plan (RESP) is a great beginning.
Contributions earn investment income on a tax-sheltered basis, and for beneficiaries younger than 18 years old, contributions can be eligible for up to $500 per year in federal government Canada Education Savings Grants.
An RESP is called an ESP (Education Savings Plan) until it is registered with Canada Revenue Agency (CRA).
What types of plans are available?
Family Plans can have multiple beneficiaries and allow a child's parents, grandparents, great grandparents, or siblings to contribute.
Individual Plans have a single beneficiary. All family members (including aunts & uncles) and even friends can choose to designate a beneficiary whose designation is not restricted by age or blood relationships.
For both family and individual plans, contributors and beneficiaries are required to have a social insurance number.
How much can be contributed? The life-long contribution limit for each beneficiary is $50,000. There is no maximum annual contribution for your RESP. If your beneficiary is already age one, or older, he/she may be eligible to receive grants at a rate of $500 per year for each year he/she has been alive and a Canadian resident since 2007, and $400 per year for previous years in which he/she qualifies. We can help you customize a contribution schedule to maximize the amount of grants to which beneficiaries are entitled.
There is quite a lot to learn about RESPs. You can begin by downloading our informative Registered Education Savings Plans Information Booklet. Contact us for our full RESP information package. This includes a detailed brochure with frequently asked questions, the plan terms and conditions, our application forms, and a current prospectus and quarterly report for our investment funds.
All our clients are encouraged to seek personal RESP advice from one of our Investment Funds Advisors.