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The Benefits of Opening an RESP This Holiday Season

An RESP Makes the Perfect Holiday Gift

efundmeThe holidays are just around the corner, and for most people that means hitting the crowded malls. If you’re looking for a great gift idea for your new child, niece, nephew, or grandchild, skip the toys and gift them a Registered Education Savings Plan (RESP).

An RESP is a tax-deferred savings plan that helps you save for a child’s post-secondary education. It’s a meaningful gift that’s easy to start and easy to contribute to on birthdays, graduation, Christmas, or other significant holidays or milestones.

With an RESP you, or anyone else, can make regular contributions throughout the year; up to $2,500 annually, up to a lifetime maximum of $50,000. The money grows over time tax free, until the beneficiary starts to take it out.

When an RESP is opened, the parents can apply for two separate grant programs: The Canada Educations Savings Grant (CESG) and the Canada Learning Bond (CLB). Continue reading