Maximizing Your RESP Investments

Maximizing Your RESP Investments

Parents regularly worry about their children’s future. Those concerns naturally include their children’s education and, more specifically, how to best save for their post-secondary education. The consistently rising cost of education across universities in Canada sometimes makes saving for education seems like an uphill battle. However, there are tools that can help Canadian parents save for their child’s education, one of the most common being a Registered Education Savings Plan or RESP.


Maximizing Your RESP Investments
A girl drawing on a sheet of paper


What is an RESP? 

An RESP is a tax-sheltered education savings plan created and registered by the Canadian government that assists families in saving for their child’s post-secondary education. While it is usually parents who start an RESP for their child, anyone can act as a subscriber, which is the term for the person or party who enters into the RESP contract. That means grandparents, aunts, uncles or others can open an account for a child. There is a maximum RESP contribution limit of $50,000 per child.

When the child, or beneficiary, is ready to attend university, they are able to access the funds that have been saved in their RESP. This includes contributions made by parents or other individuals, as well as any provincial or government grant money that was added to the account since the time it was created.

One of the most attractive features offered by an RESP is what the government matches to subscribers. To provide some specific numbers, the Canadian government matches 20% of the first $2,500 contributed to an RESP, up to $500 a year. This is maxed out at a lifetime limit of $7,200 per beneficiary. Although there is a maximum limit of matching government contributions, these additional funds are extremely attractive for families looking for effective savings tools.

How to maximize your RESP  

When it comes to saving for your child’s post-secondary education through an RESP, there are a number of ways you can maximize your account.

RESP provider offers these helpful guidance points:

  1. Invest additional funds. Subscribers of RESPs are not required to commit to a regular contribution schedule, but it helps if they can. Additionally, putting a little extra into your RESP can pay off. For example, if you earn a raise at work, consider increasing your contributions to your child’s RESP – it can make a significant difference in the long-term value of your account.                      
  2. Stay up-to-date on your account. It’s a smart idea to regularly review your RESP account and stay informed of any changes to provincial or federal grant money that may be available to you. CST Consultants now has a feature that allows account holders to check their status online. Not only does this mean you are on top of what is happening with your investment, but it can also help you find extra funds to direct towards your child’s future!
  3. Consider RESP gifts. Almost anyone can invest in an RESP for a child. When it comes time for birthdays, holidays or other gift-giving occasions, you can ask family and friends to contribute to the savings. These types of additions can pay off in two ways: one, the account benefits from additional funds; second, your RESP may be eligible for more in government grants.         


Maximizing Your RESP Investments
Maximizing Your RESP Investments


Regardless of whether higher education costs continue to increase or not, it’s smart for families to do things: one, save effectively through vehicles like RESPs that are specifically designed for education savings, and, two, begin to save as early as possible for higher education. Starting to save earlier means families can benefit from the tremendous power of compounding.


Lyne is a Certified Infant Massage Instructor (CIMI), Certified Professional Wedding Consultant, and an Event Planner. It has always been her dream to create a website dedicated just for Moms since her children were young. Thus, after 10 years, she finally accomplished it, and the Ottawa Mommy Club was born in May 2011. She loves all things Disney and is an avid chocoholic. She was also the Queen B of the BConnected Conference, Canada's Digital Influencer and social media Conference in Ottawa and Toronto.She coordinated the Annual Infant Information Day/Early Years Expo for the City of Ottawa for 8 years. She was also the co-chair of the Navan for Kraft Hockeyville 2009-2011 committee that organized five community events within 6 months, and helped Navan reach the top 10 finalists in Canada. In April 2011, she received the City of Ottawa Mayor's City Builder Award.

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  1. You are so right about the importance of RESPs..we started ours when our girl was 2..she now is in her third year of University and has not needed student loans….Just be very careful of the institution/bank you deal with

  2. We have RESPs set up for all 3 kids.Post secondary is expensive. While we don’t intend to pay all the fees for all 3 kids, we would like to help them out as much as we can.

  3. I really must make it a point to show more interest in our family finances. I leave it all up to my husband! I know we have RESPs for the kids, but should know more.


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