What is an RESP? Education savings basics for parents

When your child is young, life is full of everyday milestones: first steps, first backpacks, first school concerts, and maybe a little glitter on everything. Post-secondary education can feel far away in those early years, but as many parents know, time moves quickly.

Before long, your child may be thinking about what comes after high school—university, college, trades training, an apprenticeship, or another path that fits who they’re becoming. Along with that excitement can come a big question: how do we prepare for the cost?

The good news is you don’t need to have it all figured out today. A Registered Education Savings Plan, or RESP, is one of the most common ways Canadian families save for a child’s education after high school. An RESP can help your savings grow over time, may give your child access to government benefits, and can support many qualifying post-secondary paths, including university, college, trades training, and apprenticeship programs.
 

What is an RESP?

An RESP is a registered savings plan designed to help families save for education after high school. When you contribute to an RESP, your money has the opportunity to grow over time. Eligible plans may also receive government benefits, including the Canada Education Savings Grant and the Canada Learning Bond, which can add to your child’s education savings.

Once your child enrolls in a qualifying post-secondary program, RESP funds can help pay for education-related costs. That can include tuition, books and supplies, tools and equipment, transportation, and some living expenses.

And RESPs are not just for university. They can support many education paths, including college, trade school, apprenticeship programs, CEGEPs, and other qualifying post-secondary programs.
 

Who can open an RESP?

The person who opens and manages an RESP is called the subscriber. This is often a parent, but grandparents, other family members, or other eligible subscribers may also be able to open an RESP for a child.

The person who will use the RESP funds for education is called the beneficiary.

For example, if a parent opens an RESP for their child, the parent is the subscriber, and the child is the beneficiary.

To open an RESP, both the subscriber and beneficiary generally need valid Social Insurance Numbers. The beneficiary must also be a Canadian resident when the plan is opened.

Benefits of an RESP for education savings

Saving for education can feel like a big goal, but an RESP can make it easier to start.

One of the biggest benefits is flexibility. There is no annual contribution limit, which means you can contribute in a way that works for your family’s budget. You might choose a small monthly contribution, make occasional lump-sum deposits, or add extra when your budget allows.

There is a lifetime contribution limit of $50,000 per beneficiary across all RESPs. Government benefits, such as the Canada Education Savings Grant and Canada Learning Bond, do not count toward that limit.

Another benefit is that savings inside an RESP can grow tax-deferred. When the funds are eventually used for education, the student reports Educational Assistance Payments as income. Since many students have limited income while attending school, they may pay little or no tax depending on their situation.

How much can you contribute to an RESP?

You don’t need to wait until you can make a large contribution. Starting with what you can afford is still a meaningful step.

For some families that might mean setting up an automatic monthly contribution. For others, it might mean adding part of a tax refund, birthday money, or a gift from a grandparent. Some families also choose to set aside a portion of their Canada Child Benefit to help build education savings.

The earlier you start, the more time your savings may have to grow. But even if your child is older, it may still be worth having the conversation. You may have options available to help make the most of the years ahead.

Individual vs. family RESP: What’s the difference?

When opening an RESP, families usually choose between an individual plan and a family plan.

An individual RESP has one beneficiary. You do not need to be related to the beneficiary, and in some cases, an adult may open an individual RESP for themselves.

A family RESP can have more than one beneficiary and is often used by families saving for multiple children. A family plan can offer flexibility because contributions, investment income, and eligible government benefits may be shared among eligible beneficiaries, depending on plan and government rules.

Before opening a plan, it’s a good idea to check whether another RESP already exists for the same beneficiary. This helps prevent exceeding the lifetime contribution limit.
 

What education programs can an RESP pay for?

An RESP is not about choosing your child’s future for them. It’s about helping create options.

Your child might choose university, college, a skilled trade, an apprenticeship, or a different qualifying program. They might know exactly what they want to do, or they might need time to figure it out. Either way, having education savings in place can make those next steps feel more manageable.


As your child grows, your RESP strategy can grow with them. You can review your contributions, update your savings approach, and choose options that fit your timeline and comfort level.

This article is part one of a three-part RESP series. In the next article, we’ll look at how government benefits like the Canada Education Savings Grant and Canada Learning Bond can help education savings grow.
 

Start with a conversation

Saving for education is really about more than future costs. It’s about giving your child support, flexibility, and confidence when it’s time to take their next step.

Whether your child is still in the glitter years or already talking about life after graduation, an RESP can help you start building toward what comes next.

To learn more, call SCU at 1.800.728.6440 or book an appointment online to speak with an SCU wealth advisor.

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