RESPs and Back to School

Tax-effective Ways to Get Funds out of RESPs

We tell our kids to stay in school and get an education - now we have to prepare for that day!

An RESP is a tax-deferred savings plan that allows parents to contribute up to $50,000 per child towards saving for post-secondary education. The addition of government money in the form of Canada Education Savings Grants (CESGs) can add another $7,200 per child to the plan. Combine that with income earned and gains realized in an RESP but untaxed over the course of your kids’ childhood and you may be in the fortunate position of having a pile of cash to fund their education. But what’s the most tax-effective way to access these funds? Have a look at considerations to keep in mind regarding RESPs.