Registered Education Savings Plans
It is never too early to start planning for your child’s future education. Set yourself, and your child, up for success with a Registered Education Savings Plan (RESP).
What is it?
An RESP helps you manage future education costs for your loved ones. It lets you accumulate funds to finance a child’s post-secondary schooling and have them topped-up through Government of Canada grants.
Who is it for?
The person the RESP is for must be a Canadian resident with a valid Social Insurance Number (SIN).
What are the benefits?
- Your investment income can include savings options, interest, dividends and capital gains.
- You are not taxed on investment income earned, and your child can usually withdrawal the money tax-free (subject to eligibility requirements).
- The Canada Educations Savings Grant (CESG) pays 20 per cent of what you contribute annually to your RESP to a maximum of $500 in respect to each beneficiary ($1,000 if there is unused grant room from a previous year), to a lifetime limit of $7,200.
- Subject to income qualifications, an additional yearly amount may be payable under the CESG.
- The Canada Learning Bond (CLB) will provide an initial $500 to children in modest income families. The CLB also includes an additional payment of $100 for each year of eligibility, up to 15 year, for a maximum of $2,000.
- Individual and family plans are available. Family plans can help you pool resources in cases where all children in the family might not pursue post-secondary education.
- RESPs can only be opened by parents, or family and friends with written consent by the child’s care giver.
If you’d like more information regarding RESPs, make an appointment with a Financial Planner today. Contact us today at 1-877-WESTOBA or FinancialPlanning@westoba.com.
Check out our RESP brochure for more information.