The Registered Education Savings Plan or RESP is without a doubt one of the most interesting financial products on the market when it comes to education savings. So why is the RESP overlooked so often, trumped by the RRSP or the popular TFSA (which certainly got a lot of media coverage this year)?

Experts suggest this is potentially due to lack of awareness, budgeting priorities or simply that households are tapped out and don’t have the means to save for something over a decade away. But one thing is for sure: a survey released by the Chartered Professional Accountants of Canada found that 47% of Canadian parents have not opened an RESP for their child.

So let’s take a closer look into what exactly so many Canadian families and children are missing out on.

Free Grant Money Please!

What makes the RESP so appealing? Simple, the RESP is the only financial product eligible for education savings grants totalling up to $12,800 per child.


Every Canadian child with an RESP is entitled to the Canada Education Savings Grant (CESG). In Quebec, our children also benefit from the Quebec Education Savings Incentive (QESI), one of the few provincial grants out there. The combined grants offer a minimum 30% contribution on every dollar saved in an RESP, regardless of family income. Children could also be entitled to another 15% to 30% based on adjusted family net income.

These grants can reach a hefty sum and will grow tax-free with your RESP contributions. So ask yourself, are you really willing to turn down this much free money for your child?

RRSP or RESP… Why not Both!

If you’re racking your brain wondering if you should prioritize retirement or education savings, here’s a fun fact: an RESP can offer you the best of both worlds! With a REFLEX Plan from Universitas, the refund of your contributions is 100% guaranteed (including all sales charges), and returned to you at plan maturity, tax-free. You can then choose to add this sum to your child’s education fund or transfer it to an RRSP nest egg for retirement.

Freedom and Choice for your Child

Still need a couple of pros for the RESP? Then consider this: an RESP with Universitas will provide educational assistance payments (EAPs) for all levels of post-secondary education, whether university, college, trade school, vocational training, CEGEP… you name it![1] These studies can be pursued anywhere in the world, and the EAPs can be used to cover any education-related expense, like tuition, housing, groceries, books, etc.

In sum, setting up an RESP is a sound investment decision and a proactive initiative for your child’s future, one that will allow him or her to pursue a post-secondary education without being covered in both books and bills!

Article by Sarah DeMelt


[1] For the complete list of eligible studies, please refer to the Universitas Prospectus at universitas.ca

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