📚 Account Guide
RESP — Registered Education Savings Plan
Get a 20% government grant on every dollar you save for your child's education — up to $7,200 in free money over their lifetime.
• Updated May 2026• 🇨🇦 Canada only• 8 min read
Last updated May 2026
Key Takeaways
- ✓CESG: 20% match on first $2,500/yr = up to $500 free/yr
- ✓Lifetime CESG maximum: $7,200 per child
- ✓Lifetime contribution limit: $50,000 per beneficiary
- ✓Contributions grow tax-sheltered until withdrawal
- ✓Withdrawals taxed in student's hands — usually near $0
- ✓Catch up missed CESG years at $500 extra per year
- ✓Open early — CESG stops when child turns 17
- ✓Individual or Family RESP: Family works for 2+ children
20%
Government grant
on first $2,500/yr
$7,200
Max lifetime grant
CESG per child
$50,000
Lifetime limit
contributions per child
How the RESP Works
An RESP is a tax-sheltered savings account designed specifically for a child's post-secondary education. You contribute money, the federal government matches 20% of the first $2,500 each year (the CESG), and all growth inside the account is tax-sheltered until withdrawal.
When your child enrolls in a qualifying post-secondary program — university, college, trade school, or apprenticeship — they withdraw the funds as Educational Assistance Payments (EAPs). EAPs are taxed as income in the student's hands, not yours. Since most students have low income, the tax is typically minimal or zero.
Example: Contribute $2,500/year from birth to age 17 → $42,500 contributed + $7,200 in government grants + growth. At a 6% return, the account could reach ~$90,000 by age 18.
Available Government Grants
CESG (Basic)
20% on first $2,500/yr = up to $500/yr
$7,200 lifetime per child · All Canadians
CESG (Additional)
Extra 10–20% on first $500 for lower-income families
Up to $100/yr additional · Family income under ~$111K
CLB (Canada Learning Bond)
Up to $2,000 (no contribution required)
$2,000 lifetime · Lower-income families (National Child Benefit)
ACES (Alberta)
$500 at birth, $100/yr ages 8, 11, 14
$800 lifetime · Alberta residents
BCTESG (BC)
One-time $1,200 grant
$1,200 lifetime · BC residents, child age 6–9
Individual vs Family RESP
Individual RESP
- • One beneficiary only
- • Anyone can open one (grandparents, etc.)
- • Beneficiary can be changed
- • Best for one child or uncertain plans
Family RESP
- • Multiple beneficiaries (siblings)
- • Grants can be shared between children
- • More flexible if one child doesn't attend school
- • Best for families with 2+ children
How to Open an RESP
1
Get your child's SIN
Apply for your child's Social Insurance Number through Service Canada. You'll need this to register for grants.
2
Open an RESP account
Open a self-directed RESP at a brokerage like Wealthsimple, or a pooled RESP at a bank or scholarship trust.
3
Register for the CESG
Your financial institution handles CESG registration automatically when you open the account and provide your child's SIN.
4
Set up automatic contributions
Contribute $208/month ($2,500/year) to maximize the annual CESG. You can start small and increase over time.
5
Choose your investments
In a self-directed RESP, invest in ETFs like XEQT (100% equity, 20+ year horizon) and shift to bonds as university approaches.
Frequently Asked Questions
What is the RESP contribution limit?▾
There is no annual contribution limit for an RESP, but the lifetime maximum per child is $50,000. To maximize the Canada Education Savings Grant (CESG), contribute at least $2,500/year — that earns you $500 in free government money each year.
What happens to RESP money if my child doesn't go to school?▾
If your child doesn't pursue post-secondary education, you have several options: transfer grants and earnings to a sibling's RESP, roll up to $50,000 of the earnings into your own RRSP (if you have room), or withdraw the original contributions tax-free and pay regular income tax + 20% penalty on the grant portion.
Can I open an RESP before my child gets a SIN?▾
You need your child's Social Insurance Number (SIN) to apply for government grants, but some institutions let you open the RESP first and add the SIN later. Apply for your child's SIN as early as possible to start receiving grants.
Who can be a subscriber (contributor) to an RESP?▾
Any Canadian resident can open an RESP for a child — parents, grandparents, aunts, uncles, or family friends. There can be multiple subscribers on one RESP, but only one account per beneficiary can receive grants.
When does the CESG stop?▾
The CESG stops at the end of the calendar year in which your child turns 17. To receive the grant for age 16 and 17, you must have contributed at least $2,000 before age 16 or made $100 in contributions in any four years prior.
What programs qualify as post-secondary education for RESP withdrawals?▾
A qualifying educational program must be at a designated post-secondary institution — this includes Canadian and many international universities, colleges, trade schools, CEGEPs, and apprenticeship programs. The program must be at least 3 weeks long and require at least 10 hours of instruction or work per week. Part-time enrollment also qualifies for a reduced EAP.
Can I catch up on CESG if I missed contributing in some years?▾
Yes — you can carry forward unused CESG grants and catch up on missed years, but only $500/year in additional CESG (on top of the regular $500) can be claimed at once. So if you missed two years, you could contribute $5,000 in a single year and receive $1,000 in CESG ($500 for the current year + $500 catch-up). The maximum catch-up is one missed year per calendar year.
What investment should I hold in an RESP?▾
For a child under 10, an all-equity ETF like XEQT works well — you have 10+ years to ride out volatility. Starting around age 12–14, gradually shift toward a balanced or conservative portfolio to protect against a market downturn right before university. A target-date fund or a simple XBAL (80/20 equity/bond) is a common choice for the final 3–5 years.
What are Educational Assistance Payments (EAPs) in an RESP?▾
When your child withdraws from the RESP for education, the portion that comes from grants and investment growth is called an EAP. EAPs are taxable income in the student's hands — but since most students have very low income, they typically pay little or no tax. The principal (your original contributions) can be withdrawn tax-free at any time as a Post-Secondary Education Payment (PSE).
Can I contribute to an RESP for a grandchild or another family member's child?▾
Yes — anyone can open an Individual RESP for any child they have a relationship with. The subscriber doesn't have to be the child's parent. Grandparents, aunts, uncles, or family friends can all open and contribute to an RESP. For a Family RESP, all beneficiaries must be related by blood or adoption to the subscriber.
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