Back To School: Smart Ways to Maximize Your Child's RESP
As students head back to class, many families are thinking ahead to the cost of post-secondary education. While tuition is often top of mind, a well-planned RESP strategy can help support a child’s education journey in more ways than one.
An RESP Can Help Cover More Than Tuition
Once a student is enrolled in a qualifying post-secondary program, RESP funds can help cover a range of education-related expenses beyond tuition. This added flexibility can help families manage the overall cost of education. RESP withdrawals can help cover:
- Rent or residence expenses
- Groceries and meal plans
- Textbooks and supplies
- A laptop or computer
- Internet and phone bills
- Transportation costs
- A bicycle or vehicle used for commuting
- Other everyday living expenses
Good News for Parents
During the first 13 weeks of post-secondary studies, RESP Educational Assistance Payments (EAPs) are generally limited to $8,000 for full-time students and $4,000 for part-time students. Once that period has passed, eligible students can typically access larger amounts as needed, while original RESP contributions remain available tax-free. In 2026, individuals can earn up to $16,452 in income federally and $18,952 provincially without having to pay income tax.
RESP Withdrawals Offer Tax Advantages
Another benefit of an RESP is its tax treatment. When RESP funds are withdrawn, government grants and investment earnings are generally taxable to the student rather than the parent. Because many students have low incomes, little or no tax may be payable on these amounts. Also, there’s no annual contribution limit. You can contribute at your own pace, up to the $50,000 lifetime limit per beneficiary.
Government Grants Can Help Boost Savings
One of the biggest advantages of an RESP is access to government incentives. While many families know about the Canada Education Savings Grant (CESG), fewer realize that unused grant room can often be carried forward. This can give families the opportunity to catch up on missed contributions and receive additional grant support over time.
Unlock More Savings for Your Child's Education
The Canada Education Savings Grant (CESG) provides a 20% match on annual contributions, up to $500 per year per child, with a lifetime maximum of $7,200. Families may also be able to catch up on unused grant room and receive up to $1,000 in CESG in a single year. And the best part is that RESPs offer long-term flexibility. Plans can generally remain open for up to 35 years.
RESPs Support Many Different Educational Paths
RESPs aren't just for university. Today's students have more educational options than ever before. An RESP can help support their goals and open doors to future opportunities, including:
- University degrees
- College diplomas
- Trade schools
- Apprenticeship programs
- Technical training
- Certain vocational and certification programs
Families Often Have More Flexibility Than They Think
Life doesn't always unfold exactly as planned, and that's okay. If a child chooses to delay post-secondary education or pursue a different path, there are other options available, like:
- Keeping the RESP open while plans evolve
- Transferring the beneficiary to a sibling
- Withdrawing original contributions
- Exploring other planning opportunities for accumulated savings
A Review Today Could Make a Difference Tomorrow
A conversation with your financial advisor can help ensure you're maximizing available grants, and taking full advantage of the opportunities your RESP can provide.
Securities-related products and services are offered through Raymond James Ltd. (RJL), regulated by the Canadian Investment Regulatory Organization (CIRO) and a Member of the Canadian Investor Protection Fund. RJL financial/investment advisors are not tax advisors, and we recommend that clients seek independent advice from a professional advisor on tax-related matters. Insurance products and services are offered through Raymond James Financial Planning Ltd., which is not regulated by CIRO and is not a Member of the Canadian Investor Protection Fund. Solus Trust Company (“STC”) is an affiliate of Raymond James Ltd. and offers trust services across Canada. STC is not regulated by CIRO and is not a Member of the Canadian Investor Protection Fund.