Resp Ontario Calculator

A Registered Education Savings Plan (RESP) is a tax-advantaged savings plan designed to help parents save for their child's post-secondary education. In Ontario, RESPs offer tax-deferred growth, contributions from family members, and government contributions in some cases. This calculator helps you estimate your RESP's growth over time and project the payout amount.

How RESP Works in Ontario

Ontario's RESP program is managed by the Ontario Trillium Foundation for Education Savings (TFES). Here's how it works:

Key Features

Tax-Deferred Growth: Contributions and earnings grow tax-free until withdrawn.
Government Contributions: The Ontario government matches contributions up to $500 per year.
Flexible Withdrawals: Funds can be used for tuition, books, supplies, or living expenses.
Lifetime Maximum: The RESP can grow to $50,000 before the government stops matching contributions.

Eligibility

To open an RESP in Ontario, you must be:

A Canadian resident
A parent or grandparent of the child
At least 18 years old

Important Notes

RESPs are not insurance products and are not guaranteed by the government. The value of your RESP may fluctuate with market conditions. Always consult a financial advisor before making major decisions about your RESP.

Using the RESP Calculator

Our calculator estimates your RESP's growth over time based on your contributions, assumed annual return, and the number of years you plan to save. Here's how to use it:

Enter your initial contribution (if you already have funds in your RESP).
Enter your annual contribution (how much you plan to contribute each year).
Select your assumed annual return (average expected growth rate).
Enter the number of years you plan to save.
Click Calculate to see your projected RESP balance.

The calculator shows you the future value of your RESP and provides a growth chart to visualize how your savings accumulate over time.

Formula Used

The calculator uses the future value formula for compound interest:

Future Value Formula

FV = P × (1 + r)^n + PMT × [(1 + r)^n - 1] / r

FV = Future Value of RESP
P = Initial Contribution
PMT = Annual Contribution
r = Annual Return Rate (as decimal)
n = Number of Years

This formula calculates the future value of your RESP by accounting for both the initial contribution and the annual contributions, assuming compound interest.

Worked Example

Let's say you want to estimate your RESP's growth with these assumptions:

Initial Contribution	$1,000
Annual Contribution	$1,200
Annual Return	5%
Number of Years	10

Using the formula:

FV = 1000 × (1 + 0.05)^10 + 1200 × [(1 + 0.05)^10 - 1] / 0.05

Calculating this gives you an estimated future value of approximately $23,500 after 10 years.

Example Notes

This is an estimate based on assumed returns. Actual results may vary due to market conditions and other factors. Always consult a financial advisor for personalized advice.

Frequently Asked Questions

How much can I contribute to an Ontario RESP?

There is no annual limit on contributions to an Ontario RESP. However, the government will only match contributions up to $500 per year until the RESP reaches $50,000.

Can I withdraw money from my RESP before my child goes to university?

Yes, you can withdraw money from your RESP at any time, but withdrawals before age 60 are subject to a 20% federal tax penalty. Withdrawals for qualified education expenses are tax-free.

What happens if I don't use the money in my RESP?

If you don't use the money for qualified education expenses, withdrawals after age 60 are tax-free. However, withdrawals before age 60 are subject to income tax and a 20% penalty.

Can I transfer my RESP to another person?

Yes, you can transfer your RESP to another person, such as a sibling or another family member, but the new beneficiary must be a Canadian resident and at least 18 years old.