How the Registered Education Savings Plan and related benefits work together
A Registered Education Savings Plan (RESP) is a special savings account to help save for a child's education after high school, including trade schools, CEGEPs, colleges, universities, and apprenticeship programs. When you open a plan, you can ask your financial institution (the promoter) to apply for benefits to help pay for the child's education after high school. If the child is eligible, they can receive the following in the RESP:
- The Canada Learning Bond (CLB) can provide up to a maximum of $2,000 per eligible child
- The Canada Education Savings Grant (CESG) can provide up to a maximum of $7,200 per eligible child
- And, where applicable, education savings benefits from the governments of British Columbia and Quebec
Savings and benefits in the RESP can be used to pay for eligible expenses related to full- and part-time post-secondary education, such as rent, tuition, books, tools, and transportation.
Any adult can open an RESP account for a child: parents, guardians, grandparents, other relatives, and friends.
Youth, between the ages of 18 and 20, born in 2004 or later, can also open RESPs for themselves. They may also request the CLB for themselves until the age of 21 if it has not already been paid into an RESP account naming them as a beneficiary.
The subscriber is the person who opens the RESP with a promoter, including adults opening RESPs for themselves. The subscriber can also choose to make contributions. Contributions to the RESP are not needed to receive the CLB but, are needed to receive the CESG.
The beneficiary is the person (usually a child) who will get money from the RESP to pay for their education after high school, as long as the school and program are eligible.
- The beneficiary can be a child or an adult
- The beneficiary can be the same person as the subscriber, if an adult opens an RESP for themselves
- Depending on the plan type, there can be more than one beneficiary for each RESP
The promoter is the financial institution where you open the RESP. The promoter administers all amounts contributed into the RESP and releases money from the RESP for the beneficiary when it is needed for eligible expenses for education after high school.