A Primer on RESPs and Other Savings Opportunities

Geoff Currier

Back to school time is just around the corner! For those who saved for future that includes post-secondary education, the tuition fees sting less when your high school graduate starts post-secondary school this fall. More can always be done, however to prepare families at the start of this journey. The benefits of the Registered Education Savings Plans (RESPs), and other savings opportunities, is a good financial planning topic this summer. Here’s a primer:

The Backdrop: Registered Education Savings Plans (RESP) are quite widely accessed. They can be a major boost right from the birth of child.

In a report released by Statistics Canada in February of 2026, for the year 2025, nearly three-quarters (71%) of parents and guardians of children under 18 years of age in Canada were saving for their children's postsecondary education through registered or other savings vehicles, up slightly from 2020 when the number was 69%.

The RESP was the most popular choice. According to the report, among children younger than 18 years with postsecondary education savings, approximately 89% had a registered education savings plan (RESP) in 2025, up from 85% in 2020.

Other choices:

• bank accounts in the child's name or in-trust accounts (used by 28% of parents)
• tax-free savings accounts (28%)
• investments in mutual funds (14%)
• registered retirement savings plans (12%)
• registered disability savings plans (3%)
• and other types of investments (11%).

Majority Delay Savings, However. Here’s the bad news: over half (51%) of parents who were not saving for their children's postsecondary education reported planning to start later. That’s a loss of valuable compounding time. The most common reasons?

• 54% said the number one reason was that all available funds go toward day-to-day expenses
• 33% were putting it off to when the time comes
• 27% want to pay off debt first

Other Reasons? There are certainly more ways to support children in their educational pursuit than with a savings account:

• Let’s see if they go! 64% of parents indicated that they would help their children pay for postsecondary education once they begin
• Free Room and Board: 59% plan to offer free room and board—often by continuing to support their children at home—or the use of a car.
• Student loan assistance: 27% indicated that they plan to help their children repay all or part of a student loan.

However, 17% plan to take out loans when the time comes. These decisions all require some financial planning help as they potentially bind two generations to debt.

RESP and CESG: The Registered Education Savings Plan should always be introduced in every tax and financial planning opportunity. The federal government has made some changes to improve RESP. These plans are enhanced by the government matching program: The Canada Education Savings Grant (CESG) accumulates to a lifetime maximum of $7,200.

The CLB Changes: Another matching program for lower earners who open an RESP account is the Canada Learning Bond (CLB), which will see some significant change in the future. Beginning in 2028-29, the government will automatically open an RESP and deposit $500 into the CLB account if the child does not already have one by age 4. This addresses the issue of low uptake as up until now only about 45% of eligible families a CLB account for their child. 

The age limit to retroactively claim the CLB has been raised from 20 to 30 years. Further, income thresholds to determine CLB eligibility are adjusted annually for inflation so that more lower income families may receive up to $2,000 without having to make any contributions themselves.

The Bottom Line. Making contributions to RESP’s are not well understood. First they are not tax deductible. However, the money earned in the account can be, unless the amount is withdrawn to help pay for tuition down the road. Earnings in the plan are tax deferred.  

There is a high value planning opportunity to discuss with new parents and grandparents. Be sure to go through the implications of the RESP, CESG and CLB. Expert advice is needed to invest in their children’s educational future.

Parents will need to determine for themselves which educational saving options are best for them, and that will be easier, together with sound advice from their tax or financial advisors. If that’s you and you do not have expertise in this area, you should consider bolstering your knowledge with a CE Summit or online income tax strategies course from Knowledge Bureau.

Also, be sure to listen to Real Tax News with Evelyn Jacks and Friends wherever you tune into your favourite podcasts and let your clients know as well.