Registered Education Savings Plan: Individual Plan or Family Plan

The cost of higher education for children in Canada is a major concern for almost every household in the country. It has been on a constant rise during the past decade. This has made many parents concerned about the future of their child's education. There are many programs that are run by the government in the hope of reducing these worries for the parents. But one of the most effective programs has been Registered Education Savings Plan (RESP). This program is approved by the government and can be effectively used to prepare for the expenses related to the higher studies of your children.

The most important requirement of getting a Registered Education Savings Plan (RESP) for your child is the Social Insurance Number. Once you have the SIN, you will have to follow some basic steps to get started. There are two kinds of RESP - Individual plan and Family plan.

Individual Plan

There can be only one beneficiary in the individual plan. The beneficiary can also be the subscriber. While there is no restriction of age for RESP, many grants including CESG are paid only to beneficiaries who are under 18 years old. In case of RESPs, the beneficiary can be replaced by anyone, including those who are not blood related. However, in case of CESG, the grants will be required to be repaid.

Family Plan

There can be more than one beneficiary in a family plan. The subscriber must be related to the beneficiary by adoption or blood. This includes siblings, grandchildren or children of the subscriber, by adoption, marriage or by blood. While beneficiaries can be added anytime when the plan is active, only individuals below 21 years old can be added.

If the number of beneficiary is more than one, then you will need to allocate the percentage of contribution for each beneficiary. In case of twins, you might want to allocate 50% each, however, in case of beneficiaries of two separate ages you might want to allocate more for the older one, as you will have extra time for the younger one.

It is important to get your RESP done by a quality service provider like Heritage Education Funds Inc. A quality service provider would be able to suggest you the best options and will help you get the maximum benefit out of the various educational Grants programs run by the government. A good RESP provider will be associated with maximum educational Grants programs run by the government. Heritage RESP is associated with four major educational Grants programs.

While creating a RESP, it is important to carefully choose your options. While choosing your options always keep your long term financial ability in view. With Heritage RESP, you will have the option to deposit your savings monthly, annually, once in five years or once in 10 years. Multiple options and flexible terms and conditions really help when you are planning your financial future. There is nothing better than having enough money to pay for the expenses of your child's higher education. And with the help of Registered Education Savings Plan (RESP) you will certainly be able to ensure the money required for your child's higher education.