RESP vs LESP: What Every Parent Should Know Before Choosing

RESP vs LESP: What Every Parent Should Know Before Choosing

When it comes to saving for your child’s future, most Canadian parents are familiar with the Registered Education Savings Plan (RESP). But there’s a powerful alternative gaining momentum: the Legacy & Education Savings Plan (LESP). LESP offers parents greater flexibility, protection, and long-term value — beyond just education.

If you're weighing your options, this breakdown will help you make an informed decision rooted in what’s best for your family.

What is an RESP?

An RESP is a government-registered savings plan designed strictly for post-secondary education expenses. You can contribute up to $50,000 per child, and the government adds a 20% grant (CESG) up to a lifetime max of $7,200.

RESPs grow tax-sheltered, but when the funds are withdrawn for school, the growth and grants are taxed in the student’s hands — usually at a lower rate. Sounds great, right?

But here’s the catch: if your child doesn’t attend post-secondary education, you may face penalties or be required to return unused grants. RESP funds are restricted and don’t offer flexibility for other life goals.

What is LESP?

The Legacy & Education Savings Plan (LESP) is a modern, three-pronged solution that combines:

1. Education and milestone savings

2. Permanent life insurance protection

3. Legacy-building and tax-advantaged growth

With LESP, you’re not locked into education-only use. Your savings can support a first car, a wedding, a home down payment, or even a business launch. It’s built for parents who want to empower their kids across life’s big milestones — not just university.

LESP vs. RESP at a Glance

Feature RESP LESP Funds Usage Education only Any life goal (education + more) Government Grants Yes No Insurance Protection No Yes — includes permanent life insurance Flexibility Limited High — no penalties for non-education use Growth Potential Depends on market Stable, tax-advantaged, long-term growth Legacy Potential No Yes — builds generational wealth

Why More Parents Are Choosing LESP

Today’s families want options. LESP gives you:

• ✅ Flexibility to support whatever your child’s path looks like

• ✅ Security through built-in insurance protection

• ✅ Steady growth via participating whole life strategies

• ✅ Legacy that extends beyond your lifetime

RESPs may be useful in the right context — but LESP offers a holistic, love-powered approach that’s built for modern parenting.

Final Thoughts

You don’t need to choose between education and other goals. With LESP, you can cover it all — while giving your child the gift of financial stability and freedom. Whether they go to college, start a business, or chase a dream, you’ll have their back.

Want to learn more?
Book a free consultation with a Smart Start Advisor today — and take the first step in building your family’s future with purpose.