Many Canadian parents have established Registered Education Savings Plans (RESPs) for their children or grandchildren. These are special savings vehicles designed to help with post-secondary education.
Unlike RRSPs or life insurance, RESPs cannot have beneficiaries on them. If the plan holder dies, without specific instructions, the RESP is collapsed into the estate of the plan holder. If you have an RESP for a child or grandchild, and you want it to continue if you die, with the child’s guardian as the new subscriber, you must have something to that effect in your will. Otherwise, the plan for their education will die with you, and your estate may face some taxes for not using the money for that child’s education.
