Registered education savings plan (RESP)
Save for education with government grants
If you have children or grandchildren, you want them to have every advantage. Setting aside money for their post-secondary education opens doors for them, and a registered education savings plan (RESP) can help you save more, faster.
The first $2,500 you contribute each year gets a 20% matching contribution from the federal government*—a guaranteed return on your investment. In addition, you don’t pay tax every year on the growth of your investments. Instead, the money you would have paid in taxes continues to grow inside the plan. When your children or grandchildren are eligible** to start receiving the money to pay for tuition, books, computers, residence, meal plans, transportation and more, they pay the tax—generally at a much lower rate than you would have paid.
If you live in Quebec, Saskatchewan or British Columbia, you may qualify for additional grants; however, Manulife Investments currently does not support any of the provincial incentive programs. Low-income families across Canada may also qualify for the Canada Learning Bond.
* Up to the maximum Canada Education Savings Grant (CESG) of $7,200 for each child available up to the end of the year that the child turns 17 (there are eligibility restrictions in the year a child is turning 16 and 17).
**Eligibility requirements apply for education assistance payments.
Accelerate your education savings with these RESP strategies
Save more when you:
Start early—you can open an RESP as soon as a child has a social insurance number; the longer your investments enjoy tax-deferred growth, the better
Set up regular contributions—this makes saving for education routine and easy
Maximize CESG grants by contributing $2,500 each year—but if you miss a year remember you can carry forward your grant room and collect on contributions up to $5,000 every year
Maximize RESP savings by contributing up to $50,000 for each child
Get higher returns and less risk with a diversified portfolio designed to meet your personal goals
Ready to invest?
Speak to your advisor to discuss investment options to help meet your needs. If you don’t have an advisor, we can help you find one.
Frequently asked questions
The subscriber contributes to the RESP.
No, there is no annual contribution limit. However, there is a lifetime contribution limit of $50,000 per child.
The beneficiary is the individual named by the subscriber to receive the money to pay for post-secondary education.
If the beneficiary does not enroll in a post-secondary educational program and if another beneficiary is not named, the terms of the RESP may offer options to withdraw the RESP property for non-education purposes:
- Contributions can be returned tax-free to the subscriber at any time
- Accumulated Income Payments (AIP) that are taxable payments consisting of investment earnings may be paid, under specified conditions, to the subscriber. You can reduce the amount of AIPs that are subject to tax if you have available RRSP contribution room and you contribute an amount (up to a lifetime maximum of $50,000) to your or your spouse’s or common-law partner’s RRSP.
- Amounts received under the government grant programs may need to be repaid
- You can also wait a while before withdrawing funds and terminating the plan. RESPs can remain open for 36 years. The beneficiary may decide to enroll in post-secondary education at a later time.
For more information on RESPs, you can check out the Manulife Investments Learning Centre FAQs.