Investment Plans for Children: RESP and Beyond

Investing in your child’s education is one of the top priorities for every family. With post-secondary education costs in Canada steadily rising, starting an investment plan early is not just a smart move—it’s essential to ensuring your child isn’t burdened with financial stress later in life.

The Registered Education Savings Plan (RESP) is a powerful, government-supported tool—but it’s not the only one. In this article, we’ll explore RESP in detail and introduce additional strategies to help you build a more comprehensive financial future for your child.

RESP – The Core of Educational Investment in Canada

RESP (Registered Education Savings Plan) is a government-sponsored education savings account with three major benefits:

🎓 Tax-free growth on investment earnings until funds are withdrawn for education

💰 Government support through the Canada Education Savings Grant (CESG): up to $7,200 CAD per child

📘 Flexible use for various post-secondary programs: university, college, vocational training, etc.

You can contribute up to $50,000 CAD per child, with no annual contribution limit. The government matches 20% of your annual contributions up to $500 CAD/year—a “free return” you don’t want to miss.

👉 Pro Tip: Start early. By contributing just $2,500 CAD annually, your child can receive the full $7,200 CAD CESG over time—a significant boost for their education journey.

Beyond RESP – Supplementary Strategies for Smart Parents

While RESP is effective, it shouldn’t be your only strategy. Here are additional investment channels to expand your child’s financial opportunities:

1. TFSA for Parents – Flexible and Tax-Free

The Tax-Free Savings Account (TFSA) isn’t specifically for education, but it's incredibly versatile:

• Tax-free investment growth on capital gains and dividends

• Flexible withdrawals anytime for any purpose

• Suitable for other major goals like home purchase or funding your child’s startup

✅ A great option if you want more flexibility than RESP, or need a secondary reserve fund beyond educational needs.

2. Non-Registered Investment Accounts

Once you’ve maxed out RESP and TFSA limits, consider non-registered accounts:

• No limit on contributions

• Access to a wide range of investments (stocks, ETFs, bonds...)

• Income is taxable, but you can open the account under your child’s name to leverage their lower tax bracket

💡 Smart strategy: Invest long-term here and transfer funds into RESP/TFSA later when new contribution room becomes available.

3. Insurance-Based Investment – Universal Life Insurance (ULI)

Universal Life Insurance offers both protection and long-term investment accumulation:

• Cash value grows over time

• Funds can be borrowed from the policy to support education expenses

• Doesn’t affect RESP eligibility or student loan access

🎯 Ideal for parents who want to combine protection with strategic investing and long-term financial planning.

Invest in Values – Not Just Money

A financial plan for your child is not only about accumulating money—it’s also about:

• Teaching them early financial literacy

• Instilling saving and investing habits

• Inspiring values around preparation, discipline, and long-term thinking

You can involve your child in reviewing RESP progress, explaining compound interest, or simply discussing the importance of education and resilience.

Conclusion: Investing in the Future Starts Today

The earlier you start investing for your child, the more options you’ll have—and the more you can benefit from compound growth. RESP is the ideal starting point, but don’t stop there. Build a financial ecosystem with TFSA, investment accounts, and strategic insurance solutions.

At TikiWealth, we don’t just help you open a RESP—we help you design a full financial plan that’s comprehensive, flexible, and tax-smart for your entire family.

📞 Contact us today for a free consultation on RESP and beyond. Let’s build your child’s financial future—together.