RESP Strategies for High-Income Families in Alberta

RESP Strategies for High-Income Families in Alberta

If you’re a high-income professional or business owner in Calgary, you’re likely thinking beyond just saving for your child’s education—you’re thinking about how to do it efficiently, tax-effectively, and with flexibility.

The Registered Education Savings Plan (RESP) is one of the most powerful tools available to Canadian families. But to unlock its full potential, high-income earners need to go beyond the basics.

This article outlines advanced RESP wealth management strategies tailored to Alberta families earning $150,000+ per year or holding significant corporate assets.  A qualified financial advisor in Calgary can help provide the advice and financial planning you need to make your journey easier.

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1. Understand the RESP Basics (and Maximize Grants)

The federal government offers the Canada Education Savings Grant (CESG):

• 20% match on the first $2,500 contributed annually per child
• Up to $500 per year per child in CESG
• Lifetime grant maximum: $7,200 per child

To maximize this, you must contribute $2,500 per child per year for at least 14–15 years, or use catch-up contributions if starting late.

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2. Open the RESP Early (Even Before School Begins)

Even if your child is still in diapers, opening the RESP early means:

• You get more years of tax-deferred compounding
• You can start capturing CESG right away
• You create a habit of education-focused investing

In Alberta, with access to financial advisors or discretionary portfolio management, RESP funds can be invested with the same rigor as your retirement investment assets.

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3. Use Corporate Dividends to Fund the RESP

If you own a corporation, you can pay yourself eligible dividends to fund RESP contributions personally. While RESP contributions must be made with after-tax personal dollars, using dividends can reduce the overall tax impact on your wealth management strategy.

This wealth management strategy works well for families who:

• Take moderate salaries or dividends from their business
• Want to shift capital from the corporation to fund education without overpaying tax
• Have already maximized RRSP and TFSA room

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4. Maximize CESG with Catch-Up Contributions

If you started late, you can contribute $5,000 per child per year to catch up one previous year of grant room.

For example:

• Child is 8 years old and you’ve never contributed
• You can contribute $5,000 this year and receive $1,000 in CESG
• Continue for 7 years to catch up on the $7,200 grant

This is a smart way for higher-income families to accelerate investment growth while optimizing government incentives.

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5. Choose the Right Investment Strategy

RESPs should not sit in cash for 18 years. Consider:

• Diversified investment portfolios early on (for long-term growth)
• Gradual de-risking as high school approaches
• Tactical rebalancing as the child gets closer to post-secondary
• Using discretionary portfolio management for active oversight

At MRG Wealth Management, we integrate RESP portfolios as part of the family’s overall wealth management plan—not as a siloed product.

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6. Plan Investment Withdrawals Strategically (EAP vs. PSE)

When the child starts school:

• EAP (Educational Assistance Payments): includes grants and income, taxable to the student (often tax-free due to low income)
• PSE (Post-Secondary Education withdrawals): return of your contributions, not taxed

For high-income families, this is a perfect income-splitting tool, shifting taxable income from parent to student at a near-zero rate.  A qualified financial advisor in Calgary can create a personalized wealth management plan tailored to you.

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7. What If the Child Doesn’t Attend Post-Secondary?

You have options:

• Transfer up to $50,000 to your RRSP (if room available)
• Keep the RESP open for 35 years in case they go later
• Transfer to another child
• Withdraw with a 20% tax penalty on earnings (but keep your contributions)

The RESP offers flexibility if plans change—especially with a strong withdrawal strategy.

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Use RESP Contributions as Part of Your Bigger Wealth Management Plan

At MRG Wealth Management, we help Calgary professionals and business owners integrate RESP funding into their broader wealth management strategy—including corporate tax planning, income distribution, and legacy goals.

As your Personal CFO, we ensure your education savings strategy works as hard as you do.

Book a discovery call to align your RESP strategy with your overall wealth management plan.

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