Registered Education Savings Plan

• Government Grants: One of the major advantages of opening an RESP is the opportunity to receive government grants. The Canada Education Savings Grant (CESG) matches a portion of your contributions, providing an extra boost to your savings. Depending on your contribution level and income, you can receive up to 20% or 40% in additional funds through the CESG. The CESG is available until a child is 17.
• Tax-Deferred Growth: All income earned within an RESP is tax-deferred until the funds are withdrawn. This means that your investments can grow faster since you don’t have to pay taxes on the earnings annually. When your child starts using the funds for their education, they will typically pay taxes on the withdrawals, but at a lower rate since they are likely to have a lower income.
• Flexibility: RESPs offer flexibility in terms of investment options. You can choose from a variety of investment vehicles, including mutual funds, stocks, bonds, and Guaranteed Investment Certificates (GICs). This flexibility allows you to tailor your investment strategy to match your risk tolerance and investment goals.
• Transferability: If you have multiple children, RESPs can be used for any eligible beneficiary. If one child decides not to pursue post-secondary education, you can transfer the funds to another eligible family member, such as a sibling.

RESP contributions cannot be deducted from your income. In addition, you cannot deduct the interest you paid on money you borrowed to contribute to an RESP.