From how to tie their shoes to how to parallel park, there are endless things you teach your child. But one subject that’s often overlooked is the importance of financial literacy. In a 2018 Ipsos survey commissioned by MNP LTD, two in five Canadians rated their financial literacy skills as poor, and more than 85% admitted they would have liked more finance and economics instruction throughout their educational experience.

November is Financial Literacy Month, and this year it’s all about helping Canadians manage debt to achieve financial balance during these challenging times by giving them practical tips and tools. As a company dedicated to promoting RESPs, we are wholeheartedly behind this, since we believe in empowering Canadians with the knowledge and tools to help them pay for their children’s post-secondary education. In fact, the Registered Education Savings Plan is Canada’s favourite education savings tool, not just because it can help you save for your child’s future, even during uncertain times, but also because it may help your child reduce or even avoid student debt.

The importance of financial literacy this month (and every month) 

Financial Literacy Month is a month dedicated to helping Canadians become more savvy with money, to build their financial resilience. This year, the focus is on how to best manage your money in a marketplace that seems to change more frequently than the list of foods your toddler will eat. With the cost of living and interest on the rise, there’s a need to find the right balance between spending on everyday purchases, like bread and bills, and paying down debt. And the more financially literate you are, the more informed your decisions will be.

Even in our changing marketplace, one thing won’t change: the fact that a post-secondary education will help your child reach their potential, which is why putting aside money for their Registered Education Savings Plan (RESP) should be on your mind as much as managing their screen time.  

It’s smart to save for your child’s education with an RESP

We all want to strike the right balance between spending and saving, but it’s not always simple. Last year, the Bank of Canada shared the unprecedented increases Canadians managed to stock away in 2020, but since then those numbers have been on a steady decline. Regardless of the state of the market, it’s important to keep looking forward and save for your family’s future—and it’s a smart idea to do it with an RESP.

When you contribute to an RESP, you get access to government-matching grants called the Canada Education Savings Grant (CESG). Here’s how it works: every year the government matches 20% of the first $2,500 you contribute to your child’s RESP, up to $500 a year, with a lifetime maximum of $7,200 per child. How’s that for a return on your investment?

Another major benefit is that it’s tax-sheltered growth. Meaning you don’t pay any taxes on the money you earn from investments made within the RESP, as long as the money stays in the account. There are other tax benefits too.

Help them graduate without the burden of debt

While tuition costs vary by province, Statistics Canada pegs the average tuition for a full-time undergraduate student in 2022 at $6,834 a year. What’s crazier than the ticket prices to see Taylor Swift is that tuition is expected to rise to a staggering $17,200 per year in 2035, according to the Canada Student Loans Program. If these jaw-dropping stats are giving you a grim picture of your future scholar trying to figure out how to manage debt the moment they leave campus to start their lives, then that’s all the more reason that developing financial literacy for students is so important.

When you read about how student loans stack up against RESPs, you’ll see that although student loans are an option, they come with a lot of downside—from the stress of trying to manage debt while trying to find a job to the heavy interest that can take years to pay off. That’s why starting an RESP and helping them pay for their education with the help of matching government grants will set things off on the right foot.

Start your RESP early and give it more time to grow

It can be hard to imagine the little kid who separates the food on their plate one day deciding on which post-secondary school to attend, but it will happen faster than you think. And the sooner you start saving for their future education with an RESP, the more time you have to earn earnings on your earnings. We’re talking about compounding—AKA one of the miracles of long-term investing. The way it works is that once the investment you make starts to grow, you can earn income on your initial investment, which is reinvested for growth too. 

For example, someone who starts an RESP for their child when they’re two, has the potential to make more money from their investments than someone who starts an RESP at age 12 and contributes an equal total dollar amount. With the cost of living being what it is, it can feel overwhelming to think about something so far down the road, but those small contributions add up, so do what you can, even if it’s only $100 a month or $15. Your future self will thank you.

Savvy savers choose CST Spark’s flexible RESP

After opening an CST Spark RESP, we suggest a CST Spark Education Portfolio based on your child’s age. We take all of the guesswork out of it for you by adjusting the asset mix in our funds over time—with the goal of you helping pay for their education. We offer flexible contributions, meaning you can adjust based on your current financial situation. Plus, we make sure you apply for all the government money you’re eligible for through your RESP—from the CESG to the provincial-specific grants in British Columbia and Quebec to the Canada Learning Bond (CLB).

All you need to do is personalize your investment in your RESP and we’ll take care of the rest. With on-demand support and live chat 6 days a week, we’re here to make your life easier and get your little superstar on the right track for their post-secondary education.

Have questions? Reach out to us in our chat or give us a call at 1-800-461-7100.

CST Spark Education Portfolios are sold only by prospectus. Investors should read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.  Copies may be obtained from

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