You know you’re ‘adulting’ when you start thinking about saving money for things like your family, kids and your retirement. Many of us are challenged with how to save for both our kids’ education and our “golden years” at the same time.  Fortunately, products like Registered Retirement Savings Plans (RRSPs) and Registered Education Savings Plans (RESPs) help make this choice a little easier. But when you’re a parent who’s being pulled in two directions, which one do you put your money in?

Let’s get to know the differences between an RRSP and an RESP.

While both are registered savings accounts where your investments can grow while giving you tax benefits, these plans serve very different purposes. RRSPs help you save for old age, while RESPs help you save for your child’s post-secondary education.

1 When funds are withdrawn during retirement, you pay taxes on this income; however, you saved tax dollars as you received a tax break each year contributions were made to plan.

2 Principal, which is contributions less sales charges and fees, is returned for CST Plans

With a little creative thinking, you can contribute to both an RRSP and an RESP

Scenario 1:

Contribute as much as you can annually to an RRSP. Use your tax refund as your annual RESP contribution. Benefit from both plans.

Scenario 2:

Contribute as much as you can annually to an RRSP. Open a CST RESP and contribute as little as $9.50/month1. That’s like foregoing 4 coffees each month!

Scenario 3:

Open an RESP. Decide how much and when you want to contribute, up to a max of $50,000/child. Once your child enrolls in a post- secondary program, you’ll get back your contributions less any sales charges and fees. Use these funds to add to your RRSP (provided there is contribution room).

Scenario 4:

If your child decides not to pursue post-secondary studies, you can transfer up to $50,000 of your accumulated income from your RESP into your RRSP (provided there is contribution room) if you  qualify.

Whichever way you decide to save should make sense for your own unique situation … what’s important is that you are saving – be it for your retirement or your child’s education, or hopefully both. When you’re ready to open an RESP, a good place to start is by talking to the sales representatives at CST Consultants. They’ll help you set up a savings plan that meets both your goals and your budget.

Canadian Scholarship Trust Plans are only sold by Prospectus. Copies of the Prospectus available at

1CST Advantage Plan minimum contribution – greater of $9.50 per month or 1/10th of a unit