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RBC Direct Investing > Account Types > Registered Education Savings Plan
Registered Education Savings Plan (RESP)
With the increasing costs associated with college or university, parents and grandparents are looking for smart ways to save for their children's and grandchildren's post-secondary education. An RBC Direct Investing Registered Education Savings Plan (RESP) can help make a difference for your child's or grandchild's future.
How does an RESP work?
- An RESP is a tax-sheltered savings plan that allows you to contribute up to a maximum of $50,000 per beneficiary
- The contributions you make to an RESP are not tax-deductible, but tax on the income earned on investments within the plan is deferred until the intended beneficiary withdraws the funds
- If the plan earnings are withdrawn to cover qualifying post-secondary education expenses, they are taxed to the beneficiary—not to the subscriber. In many cases, the beneficiary will be in a lower tax bracket at the time withdrawals are made
- Funds from an RESP can be used towards study in a qualifying program at a recognized post-secondary educational institution, as long as the beneficiary is a full-time student
- Contributions can be made over a 31-year period from the date you open the RESP, and the plan can remain open for a maximum of 35 years
Grants for RESPs
You may be eligible for grants provided by the Government of Canada and some provincial governments. Here's a quick overview of what each government program provides – along with key eligibility requirements.
Grants available for RBC Direct Investing RESP accounts
RESP Plan Types
You can choose to open an RESP Family Plan or an RESP Individual Plan:
Key benefits of an RBC Direct Investing RESP:
- Competitive trade commissions as low as $6.95 - $9.95 flat with no minimum account balance required
- Create a diversified portfolio with access to a broad selection of investments including stocks, exchange traded funds (ETFs), guaranteed investment certificates (GICs), mutual funds, bonds and more
- No commissions when you buy or sell mutual funds1
- No maintenance fee when you hold combined assets of $15,000 or more across all of your RBC Direct Investing accounts. Plus, you can take advantage of several other ways to have the fee waived.2
- Access to innovative tools and the latest research to help you make confident investment decisions
1) Mutual fund companies may assess additional fees — for example, deferred sales charges on back-end load funds, early redemption fees, setup fees and fees for insufficient funds on pre-authorized purchases.
2) Clients with combined assets of $15,000 or more in all of their RBC Direct Investing accounts pay no quarterly maintenance fee. Clients with combined assets of less than $15,000 in all of their RBC Direct Investing accounts pay $25 per quarter. Clients can open a maximum of 10 accounts for a combined maintenance fee of $25/quarter. Additional maintenance fees will apply if
a client opens more than 10 accounts. This fee will be assessed on client information as at the end of each quarter (March 31, June 30, September 30, December 31) and will be charged in April, July, October and January of every year. For complete details and for information about additional ways to have the quarterly fee waived read our Commissions and Fees Schedule.