Saving for Their Future: An RESP Guide for Parents and Grandparents

An RESP guide for parents and grandparents.

Why start now

University, college and the trades all cost more than they used to, and tuition is only part of the bill. A Registered Education Savings Plan (RESP) is the one account where the government adds money to every dollar you save.

• ~$10,000 a year in average undergraduate tuition in New Brunswick, among the highest in Canada.
• 20% added by the federal government on the first $2,500 you contribute each year.
• $7,200 in basic federal grant available to each child over their lifetime.

Sources: Statistics Canada, Tuition fees 2025/2026; Government of Canada, Canada Education Savings Grant.

How an RESP works

You save

Any amount, any time. No annual limit; up to $50,000 per child over their lifetime.

Ottawa adds

Grants are deposited straight into the plan, up to $500 a year per child.

It all grows

Growth is tax-sheltered until your student withdraws it, usually paying little or no tax.

The government money

1. Canada Education Savings Grant. 20% on the first $2,500 a year, so $2,500 earns $500. Lifetime maximum $7,200 per child.
2. Additional grant. Lower- and middle-income families get an extra 10% or 20% on the first $500 they save each year.
3. Canada Learning Bond. Up to $2,000 for children from lower-income families, born 2004 or later. No contribution needed, only an open RESP.

Started late? You can still catch up. Grant room builds up from birth, even before a plan is opened. Contribute $5,000 in a year and you can collect up to $1,000 in grant, catching up one missed year at a time.

A plan for every age

• Ages 0–5: Start early. About $208 a month earns the full $500 grant, and time does the heavy lifting.
• Ages 6–12: Keep it steady. Stay on track, or use unused grant room to catch up a year at a time.
• Ages 13–15: Mind the deadline. To keep grants at 16 and 17, have $2,000 in, or $100 a year in any 4 years, by the end of age 15.
• Ages 16–17: Last call. Grants end the year your child turns 17. Shift toward steadier investments.

For grandparents

Helping with a grandchild’s education is one of the most lasting gifts you can give. There are a few ways to do it, and the right one depends on your family.

• Gift to the parents’ plan. Often the simplest. Your gift still earns the grant, and the parents manage one plan.
• Open your own plan. You keep control. A family plan can cover several grandchildren under one account.
• Name a successor. Name a successor subscriber in your will, or the plan may be wound up into your estate.

Coordinate as a family. The $50,000 lifetime limit and the $500 yearly grant apply per child across every plan, whoever opens it. A quick conversation avoids over-contributing or missing grant room.

Getting started checklist

• Get your child’s Social Insurance Number. Grants can’t be paid without it.
• Choose an individual plan or a family plan for brothers and sisters.
• Set up automatic monthly deposits so you never miss a year.
• Check whether you qualify for the additional grant or the Learning Bond.
• Ask family to give to the RESP for birthdays and holidays.
• Review the plan with me each year, and update your will.

When it’s time for school

RESP money can be used for university, college, CEGEP, trade schools and apprenticeships, in Canada or at qualifying schools abroad.

• Your contributions: Come back out tax-free. You already paid tax on this money.
• Grants and growth: Paid to the student and taxed as their income, usually little or none. Up to $8,000 in the first 13 weeks of full-time study, then no limit.

If they choose another path

1. Wait. The plan can stay open up to 35 years, in case they go back later.
2. Share it. In a family plan, a brother or sister can use the savings.
3. Take back your deposits tax-free. Grants go back to the government.
4. Move the growth, up to $50,000, into your RRSP if you have room.

Protect the plan, too. If something happened to the person saving, would the deposits stop? Life and critical illness insurance can keep the plan funded so your child’s education stays on track.

Let’s talk about their education

Whether they’re newborn or nearly 16, I’ll help you make the most of every grant dollar.

Book a conversation with Michael, or call the office at 506-406-6100 (cell 506-440-6196). Email: [email protected]. Ask for a printed copy of this brochure at your next meeting.

For general information only; not tax or legal advice. Grant amounts, income thresholds and RESP rules are set by the Government of Canada and can change. We’ll review the details that apply to your family together.