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Why should I open an RESP?

Opening an RESP gives you access to a range of federal government grants and savings incentives to help you save for your child’s education. It also means your child will have more financial resources to cover education costs and living expenses when it’s time to start post-secondary education.

Where can I open an RESP?
You can open an RESP at a bank or a credit union.

Who can open an RESP?
Anyone can open an RESP for a child, including parents, grandparents, caregivers, relatives or friends.

What if I am a Foster Parent?
You can open a RESP in the name of the child. We also encourage you to discuss this with your social worker.

How long can I contribute to an RESP?
You can contribute to an RESP for a maximum of 22 years (including the year you opened it), although the length of time you can contribute to an RESP depends on what kind of plan you have chosen, and the age of your child.

What happens when my child is ready to begin post-secondary education?
Students can get money from the RESP as soon as they are enrolled in a qualifying educational program. They can get up to $5,000 before they complete 13 weeks in a row of a qualifying educational program, and after this, any amount of money can be withdrawn from the remaining balance of the RESP.

What happens if my child doesn’t continue his education after high school?
Even if your child decides not to continue with post-secondary education right after high school, it may make sense to keep the RESP. If the child changes his mind before the RESP expires, the money will still be available and will have continued to collect interest.

RESP money can also be transferred to a brother or sister, including most of the money contributed by the federal government, except the Canada Learning Bond.

You can also close the RESP and receive back all of the money you put in, tax-free. You can keep any interest you earned on your money if the RESP has been open for 10 years and the child is 21 years or older, although you will have to pay tax on this. If you close your RESP, all of the money the federal government contributed in grants and incentives will have to be returned.

Can I withdraw my money from my RESP?
Yes, you can withdraw your money at any time, but this may affect the federal government grants and incentives you have received. If you withdraw money from an RESP that contains the CESG, and the child is not enrolled in a qualifying educational program, you will have to return all of the CESG to the Government of Canada.

When can I withdraw the money earned in my RESP?
You can withdraw the money in your RESP if:

  • All of the children named in the plan are at least 21;
  • They are not eligible for an Educational Assistance Payment (EAP); and
  • You are a Canadian resident and you opened the RESP at least 10 years ago.

The money you withdraw will be taxed at your regular income tax level, plus an additional 20 percent. You will not be taxed on the amount you contributed to the RESP, but you will have to pay taxes on the money you earned in interest.