What is a Registered Education Savings Plan (RESP)?
A Registered Education Savings Plan (RESP) allows parents and guardians to accumulate the necessary funds to finance a child’s post-secondary education.
The federal government allows you to accumulate investment income on a tax-sheltered basis until the funds are withdrawn.
Who can open an RESP?
Anyone who has an interest in providing a child with funds for their education!
- Legal Parents
Who is eligible?
To qualify for an RESP, a beneficiary must:
- Be a Canadian resident
- Have a valid Social Insurance Number (SIN)
As an incentive for parents to contribute to their child’s post-secondary education, the federal government offers two funding mechanisms. Investments grows tax free until a withdrawal is made.
The cost of Post-Secondary school
Projections for an average student’s tuition fees and cost of living away from home have been projected to reach $118,010 in 2030. The illustration shows how the cost of living increases over time. Statistics Canada revealed that university tuition fees have risen 135% in the past 10 years
Sources: Canada Revenue Agency, Investopedia, Statistics Canada.
Contact a 3i Financial Group Advisor today to see how an RESP can help you save for your child’s education.
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