RESP-Registered education savings plan

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A registered education savings plan (RESP) is a savings product opened by anybody (parent, grandparent, guardian, friend, etc.) who wants to save for a child's post-secondary education.

Contributions to an RESP attract government grants of at least 20%, with certain provinces offering even more.

 The objective of the plan is to save money in a tax shelter for a beneficiary’s post-secondary studies, generally that of a child 

 To make the most of the RESP’s tax advantages, the federal government has set a cumulative lifetime maximum of $50,000 per beneficiary. The contribution ceiling is “per beneficiary” for all RESP contracts in his/her name and not “per subscriber” 

 The federal government created the Canada Education Savings Grant (CESG) program in 1998 to encourage parents to invest in their children’s post-secondary education. The CESG is equivalent to 20% of the first $2,500 in contributions made per beneficiary aged 17 years and under. It is calculated and paid into the plan on a monthly basis. The CESG ceiling is $7,200 per beneficiary.