Here are a couple of facts about RESP that you should know to make the most out of your account:

• The maximum you can receive from the CESG is $7000. You can get a bonus $100 a year when you first start (A-CESG), with this the combined lifetime CESG and A-CESG the maximum can receive is $7200

• You can make a maximum lifetime contribution of $50,000. If you were to only contribute $2,500 each year when your child is born until your child is 14 (the last year that you would get CESG) then you would only be contributing $35,000.

• RESP can be used for investments. There are two types of RESP investments
  • Fixed-Income Investments: Cash, short-term bonds, and guaranteed investment certificated that you contribute to your accounts, which pay you through a set interest rate. However, the interest rates are usually low and do not have a high return.
  • Equity Investments: Investing in stocks, and equity mutual funds. Investing in equity can be highly beneficial if the company or corporation you invest in goes up in value. This can give you a higher return, but stocks and funds can fluctuate often.
  • It is important to work with a financial advisor to make sure that you choose the best RESP investments.

• Taxes: The money put into a RESP and the money grown within the account are not taxed. However, when the money is withdrawn by the student, it is considered to by taxable income.