Registered Education Savings Plan (RESP) FAQ

Is there a maximum I can contribute to an RESP?
The maximum lifetime amount per child is $50,000. There is no annual contribution limit.

What is the Canadian Education Savings Grant?
The Canadian Education Savings Grant (CESG) is a Government of Canada incentive that pays 20 cents on every dollar you contribute to your RESP, up to a yearly maximum of $500 per child (also called beneficiary) to a lifetime limit of $7,200. The CESG goes directly into your RESP until the beneficiary reaches the age of 17. Beneficiaries may be eligible for an additional CESG, depending on the family’s net household income.

What is the Canada Learning Bond?
The Canada Learning Bond is a Government of Canada grant for modest-income families. If your child was born after December 31, 2003 and your monthly Canada Child Tax Benefit payment includes the National Child Benefit Supplement, the Government of Canada will make a first payment of $500 to your child's RESP and additional annual payments of $100 to the plan for up to 15 years.

How difficult is it to apply for these grants?
It’s not difficult at all. First you need to set up an RESP. Your child will need a birth certificate and a Social Insurance Number. Once the RESP is set up, your SASCU Wealth representative will apply for all eligible grants on your behalf.

When can my child withdraw money from their RESP?
The beneficiary can begin receiving Educational Assistance Payments (EAPs) from the RESP once enrolled in a qualifying post-secondary program. The student claims the EAPs as taxable income.

What happens if my child does not attend a post-secondary institution?
If the beneficiary does not use the funds, the contributions are returned to the subscriber, the grants are repaid to the government and the subscriber needs to consider one of the following options:

• Transfer the income earned (to a maximum of $50,000) into the subscriber’s,  spouse’s or common law partner’s RRSP (Registered Retirement Savings Program)
• Withdraw the income earned. In this case, the income earned in the RESP is subject to a 20% surcharge in addition to the subscriber’s marginal income tax rate
• Donate the income earned in the RESP to a post-secondary institution

How soon should I start saving?
Start saving now. The earlier you start, the more your RESP will grow. Affordable monthly contributions, combined with government grants, can grow into a significant education fund.