RESP - The Ultimate Savings Plan for Your Child's Education
As a parent, you want to ensure your child has the best possible education. However, with the rising cost of tuition and other educational expenses, it can be difficult to save enough to cover all the costs. That's where a Registered Education Savings Plan (RESP) comes in.
At Canadian Child Savings Plan, we understand the importance of education and how to plan for it. That's why we offer a range of financial services, including RESPs, to help families like yours save for their child's education.
What is an RESP?
An RESP is a savings plan registered with the Canadian government that helps you save for your child's post-secondary education. The money you contribute to the plan can be invested in various options, such as cash, Guaranteed Investment Certificates (GICs), mutual funds, and more. The income earned from these investments is tax-deferred, which means you won't have to pay tax on it until it's withdrawn.
How does the Canada Education Savings Grant (CESG) work?
One of the biggest advantages of an RESP is that the federal government can match your contributions through the Canada Education Savings Grant (CESG). The CESG matches 20% of your contributions up to $2,500 each year. That means you could receive up to $500 per year from the government, just for saving for your child's education.
What are the contribution limits?
RESPs have a lifetime contribution limit of $50,000 per beneficiary. This means that you can contribute up to $50,000 over the lifetime of the plan for each child. However, keep in mind that there are annual contribution limits as well, and they are subject to change. It's essential to check with your financial advisor to ensure you're aware of the current limits and rules.
How long can an RESP remain open?
RESPs can remain open for up to 35 years, giving you plenty of time to save for your child's education. Keep in mind that if your child decides not to pursue post-secondary education, you can transfer the funds to another beneficiary, such as a sibling, without losing the government grant money.
An RESP is an excellent savings plan that can help you save for your child's post-secondary education and take advantage of the government grant money available to you. With our financial and insurance services, we can help you make the most of your RESP and other investment options to secure your family's financial future. Contact us today to learn more about how we can help you plan for your child's education.