What the RESP gives you
A plan built for children's education, with grants from both levels of government, subject to eligibility.
Two grants in Quebec
The CESG adds 20% and the QESI 10% of your contributions, on the first $2,500 a year, subject to eligibility. Both amounts are paid directly into the RESP.
Tax-sheltered growth
As long as the money stays in the plan, growth is not taxed. Nothing to report each year.
Invested in segregated funds
Alexandre offers the RESP invested in segregated funds: an insurance contract that provides a 75% to 100% capital guarantee at maturity or on death, depending on the contract.
Grant room carries forward
CESG room you don't use in a given year accumulates and carries forward to later years.
How much in grants can your child receive?
In Quebec, a child can receive up to $10,800 in grants: $7,200 from the federal government (CESG) and $3,600 from Quebec (QESI). You need to contribute $2,500 a year to get the maximum annual amount of $750. Lower-income families reach that maximum faster, and can also receive up to $2,000 from the Canada Learning Bond without contributing anything.
| Support | What you receive | Maximum per year | Lifetime maximum | Condition |
|---|---|---|---|---|
| CESG (federal) | 20% of your contributions | $500 ($1,000 with catch-up) | $7,200 | Contribute |
| QESI (Quebec) | 10% of your contributions | $250 (catch-up possible under Revenu Québec rules) | $3,600 | Contribute, child resident in Quebec |
| Additional CESG and QESI increase | An extra amount each year, based on family income | Based on family income | Included in the lifetime maximums above | Low or middle family income |
| Canada Learning Bond | $500 the first year, then $100 per year | Based on age | $2,000 | Eligible family; no contribution required |
Sources: Canada.ca (CESG, CLB); Revenu Québec (QESI).
You start when your child is 8.
You contributed nothing from age 0 to 7. By contributing $5,000 a year, you can receive the CESG for the year and for one missed year, up to $1,000 of CESG a year, plus the QESI, until the overdue grants are caught up.
For illustration only; actual amounts depend on your contributions, your child's age and the rules in effect.
Work it out with AlexandreWhat if your child doesn't go on to post-secondary studies?
You don't lose your contributions: they're returned to you tax-free. It's the grants that have to be paid back to the governments. The investment income, under certain conditions, can be transferred to your RRSP or paid to you, with tax.
Three options before closing the plan
Your child may start studying later; the plan can stay open for many years.
In a family RESP, to a brother or sister, under conditions, without losing the grants.
If you have contribution room and the conditions are met.
The transfer and tax rules come with precise conditions. Alexandre checks them with you before any decision.
Family RESP, individual RESP, and grandparents
Family RESP
Several children related to the subscriber by blood or adoption, in a single plan. Handy for sharing the money among brothers and sisters.
Individual RESP
A single beneficiary, who can be anyone (a nephew, a family friend, yourself).
Grandparents
Grandparents can open an RESP for their grandchildren and receive the same grants.
Note: grants are calculated per child, across all plans. If the parents and the grandparents each contribute $2,500, the grant does not double.
Your RESP strategy,
without leaving home.
Alexandre reviews your situation and calls you back with a personalized recommendation. Free, no obligation.
The analysis is free. If you sign up, Alexandre is paid a commission by the insurer or product provider.
What can RESP money actually pay for?
Many parents believe the RESP only pays tuition. The reality is broader.
Money leaves the plan through two very distinct streams, which don't go to the same person and aren't taxed the same way.
Your contributions
The money you put into the plan comes back to you, the subscriber, tax-free.
EAPs
Educational assistance payments bundle together the grants and the income accumulated in the plan.
Eligible expenses are broader than you'd think
EAPs are meant to help the student pursue their studies. That goes beyond tuition alone, without meaning that anything goes.
Tuition
Tuition fees and the program's registration costs.
Housing
Rent or residence during the studies, when the student has to live near the school.
Transportation
Travel tied to the studies, such as a monthly transit pass or trips home.
Supplies and a computer
Books, supplies and the equipment the program requires.
Each expense has to stay reasonable and tied to pursuing the studies. It isn't a green light for any expense at all.
The conditions to know
The program has to require at least 10 hours a week of courses or work, over at least 3 consecutive weeks.
10 hrs / weekIf the program is given outside Canada and isn't at the university level, the minimum length becomes 13 consecutive weeks.
13 weeksDuring the first 13 consecutive weeks of full-time enrolment, EAPs are capped at $8,000. After those 13 weeks, that cap no longer applies.
$8,000The first-13-weeks cap applies again if the student interrupts their studies and doesn't re-enrol within 12 months.
12 monthsNothing is automatic: the amounts paid out depend on the program's eligibility and on the terms of the plan. Alexandre explains the rules that apply to your situation.
Who is it useful for?
The long-term effect of an RESP
Take a family contributing $2,500 a year for one child. The CESG adds $500 and the QESI adds $250, subject to eligibility.
The result: $3,250 goes into the RESP each year instead of $2,500. That's 30% more than your contribution.
Fictional example, for illustration only. No rate of return is shown or implied. Grants depend on your eligibility. Sources: Canada Revenue Agency (CESG), Revenu Québec (QESI).
The Alexandre advantage
No bureaucracy, no call center. Alexandre takes the time to understand your situation and offers solutions that truly fit you.
Before any recommendation, Alexandre establishes your investor profile. A segregated fund is not an ordinary investment account: its value can go down, no return is guaranteed and its guarantees have a cost, included in the fees. See how he works
