Funding a child's education
Education is one of the most important investment's you can make in a child's future - and planning early can make all the difference. The way you save matters just as much as how much you save, especially when it comes to maximizing government benefits and minimizing taxes.
In Canada, the primary tool for education savings is the:
Registered Education Savings Plan (RESP)
In-Trust Accounts
Tax Free Savings Accounts (TFSA)
Non-Registered Investment Accounts
The RESP offers powerful advantages, including access to the Canada Education Savings Grant (CESG) - a 20% match on the first $2,500 of annual contributions, up to a lifetime maximum of $7,200 per child. Investment growth within the RESP is also tax-deferred, and withdrawals are taxed in the student's hand, often at little to no tax.
Other options, such as In-Trust Accounts, can provide flexibility for non-education uses, while TFSAs can be useful for older children saving on their own. Structuring contributions across different accounts can help you meet both short-term and long-term goals, especially if education abroad or multi-generational support is part of their plan.
Please contact us if you would like personalized guidance on an education savings strategy for your family.
