CESG (Canada Education Savings Grant)

What it means

The Canada Education Savings Grant is a federal grant paid directly into an RESP, matching a percentage of what's contributed each year (the base rate is 20%, with higher-matching room possible for lower-income families), up to an annual and lifetime maximum per child.

Why it matters

It's the specific mechanism that makes the RESP worth prioritizing early — contribution room that goes unused in a given year doesn't necessarily disappear, but maximizing the grant generally means starting contributions well before a child is close to post-secondary age.

Common misunderstandings

• •It isn't automatic — an RESP has to actually be opened and contributed to for the grant to apply; it doesn't appear on its own.
• •There's a lifetime maximum grant amount per child, not just an annual one — contributing far more in a single year doesn't attract proportionally more grant money past the annual cap.
• •Some unused annual grant room can be carried forward, but there are limits on how much extra grant can be claimed in any single catch-up year.

Where you'll see it

On every RESP statement, and in any education-savings conversation.