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What is an RESP? How Does It Work?

    • 149 posts
    November 20, 2021 6:28 AM EST

    An RESP is a type of investment account designed to assist you in saving for your child's education. Here is everything you need to know about them. What is an RESP? Registered Education Savings Plans (RESPs) are fairly simple to understand. These accounts are regulated accounts intended to be used for saving money for a child's post-secondary education. The main advantage of a RESP is its tax-advantageous nature. As long as both the account holder and beneficiary are Canadian residents, it does not matter who opens the account. It may be a child's parent, grandparent, a friend of the family, or any old benevolent neighborhood creep, as long as he has access to the child's Social Security number. Responsibilities are not transferable other than to a sibling. In contrast, a family RESP may only be opened by parents or grandparents of the children and may be used for the education of any child in the family.