Nearly 43% of Canadian parents are using a Registered Education Savings Plan to prepare for their children’s future education, according to a recent Bank of Montreal survey.

The survey notes that 65% of parents state they are more likely to contribute to an RESP because of the Canada Education Savings Grant, a program in which the government contributes up to an additional 20% of the annual contribution to an RESP.

The CESG program contributes up to $400 per year per child towards a beneficiary’s future education. To qualify for this year’s CESG, a contribution must be made to the children’s RESP on or before December 31st. Unused contribution room can be carried forward.

“Now is the time to contribute to an RESP, either as a holiday gift or just to take advantage of the December 31st deadline to qualify for the CESG,” said Linda Knight, vice president, BMO Mutual Funds. “By contributing an additional 20 per cent on top of the regular contribution, the government is helping parents cover the rising costs of their children’s future education.”

The BMO Intuition RESP Survey, conducted in September 2001, indicated that while the majority of parents favour saving through an RESP, 23% use trust accounts, and 9% are relying on a savings account. Overall, 91% of respondents were aware of RESPs, up from 77% in 1999.