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What are the steps to open an RESP?
- Take care when you choose a Registered Education Savings Plan (RESP). It will really affect how much money you have later for your child’s education. Follow these five steps:
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- 1. Get ready:
Before you apply, you will need your Social Insurance Number. Your child will also need one. To get a number for your child, complete the government’s Social Insurance Number application form.
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2. Do your homework:
Learn about all of your RESP choices. Different plans work differently. Find out as much as you can before you meet with a sales representative.
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3. Start shopping:
Many people start by talking to someone at their bank or where they invest. Some talk to a scholarship trust company. You can also do some research over the Internet.
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4. Read all the information carefully:
Most plans will provide information about how the plan works, how much you can contribute, and your investment choices. Discuss these documents with your sales representative and make sure you understand them.
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By law, if you choose a scholarship plan, the sales representative must give you a prospectus, which describes the plan in more detail. You may also get a prospectus if you choose an RESP from a financial institution. It depends on the investments that you choose.
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Tip: Before you open any RESP, be sure you understand things like how much the plan will cost over the years, and what happens if you need to cancel or change your plans.
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5. Fill out the application forms:
You have to apply to open an RESP and to get government grants. The sales representative will help you fill out the necessary papers. Read everything carefully before you sign and keep your records in a safe place.
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Remember: An RESP is a long-term savings plan.
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You will likely live with it for many years. Take time to shop around for a plan that will work best for you. Choose with care and make sure you fully understand how the plan works before you sign any papers.
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