What are RESPs?
RESPs are to education what RRSPs are for retirement. They let you put money aside for your child’s post-secondary education. In this way, you give your child the greatest gift: an opportunity to achieve a dream career.
How do RESPs work?
1. Contribute
You begin to save early by contributing to your child’s Registered Education Savings Plan (RESP) and benefiting from generous government grants.
2. Accrue
Together, your regular contributions and government grants generate returns. Your Registered Education Savings Plan (RESP) grows tax-free.
3. Reap
You get your contributions back to fund your child’s education. Your child receives the grants and the total return from the Registered Education Savings Plan (RESP).
Do the math!
Congratulations!
is the amount you will have saved by the time your child starts post-secondary education.
Advantages
Accrue more thanks to government grants
To encourage education savings, the Government of Canada and some provincial governments add to the amount you contribute to your child’s RESP each year.
Combined with your regular contributions, this generous government aid, which is deposited into your RESP, goes a long way toward growing your savings.
Depending on your family income, you may be entitled to an additional grant. Your contributions, the grants, and the returns grow tax-free until withdrawal.
Federal government
| Grants offered by the federal government | Canada Education Savings Grant (CESG) | Canada Learning Bond (CLB) |
|---|---|---|
| Annual grant (% of contributions) | 20% | Limit of $2,000 per child for eligible families |
| Annual limit (per child) | $500 | |
| Lifetime maximum (per child) | $7,200 | |
| Additional grant (% of contributions) | 10% or 20% of the first $500 invested each year |
Provincial governments
| Grants offered by provincial governments | Quebec Education Savings Incentive (QESI) | Saskatchewan Advantage Grant for Education Savings (SAGES)* | British Columbia Training and Education Savings Grant (BCTESG) |
|---|---|---|---|
| Annual grant (% of contributions) | 10% | 10% | Single payment of $1,200 (Lifetime maximum) |
| Annual limit (per child) | $250 | $250 | |
| Lifetime maximum (per child) | $3,600 | $4,500 | |
| Additional grant (% of contributions) | 10% or 20% of the first $500 invested each year | - |
Recover the money you invest at a pace that suits you
When your child goes on to post-secondary education, you get your money back, and you do not have to pay tax on the amounts you receive.
In the meantime, your child receives the grant money and the returns earned on the entire RESP account in the form of Education Assistance Payments. Since the tax rate is generally lower for students, the amount of tax to be paid on the money received is often minimal.
No loss if your child does not go on to post-secondary education
If your child does not go on to post-secondary education, you can :
- Designate another child in the family
- Withdraw your contributions tax-free
- Transfer your accrued investment income to your RRSP under certain conditions
Opening an RESP 100% online
It is possible to open an RESP account for your child or a loved one in a few clicks in a secure way.
Choosing to invest in an RESP with iA Financial Group means having the guarantee, depending on the kind of investment, that the amounts deposited in the RESP are fully available when the child needs them.
Open an RESP onlineOur education-savings product
My Education +
More savings. More flexibility. More possibilities.
Flexible contributions and investment choices to help your savings grow.
Available plans
Individual
- Blood relationship or adoption with the child is not required.
Family
- Possibility of designating more than one child to the plan.
- Blood relationship or adoption is required.
Choice of investments
Depending on your investor profile and financial goals, you can invest in a range of attractive investments :
- Segregated funds
- High-interest savings account with a 100% capital guarantee
Are you interested in this product?
Have you considered an RESP loan to maximize your grants?
Find out how borrowing to contribute more to your child’s Registered Education Savings Plan (RESP) can be a simple solution that pays off.
Find out more about RESP loans
