Registered Education Savings Plan
RESP
A tax-sheltered savings plan to help families save for a child's post-secondary education in Canada.
What is an RESP?
A Registered Education Savings Plan (RESP) is a tax-sheltered savings account designed to help families save for a child's post-secondary education. Contributions are not tax-deductible, but investment growth is tax-sheltered until withdrawn. The government also provides grants that match a portion of your contributions.
Why It Matters for Newcomers
If you have children and plan to stay in Canada, an RESP is one of the best ways to save for their future education costs. The Canadian government contributes up to $7,200 per child through the Canada Education Savings Grant (CESG), matching 20% of your annual contributions up to $500 per year.
How It Works
You can open an RESP at most banks or financial institutions. You contribute funds that grow tax-free. The government adds the CESG (20% of the first $2,500 contributed annually per child). Low-income families may qualify for additional grants through the Canada Learning Bond.
Quick Tip
Start contributing to an RESP as early as possible to maximize the benefit of compound growth and government grants. Even small monthly contributions of $100 can accumulate significantly over 18 years. The lifetime contribution limit per beneficiary is $50,000.