Good morning. A registered education savings plan (RESP) can be a great way to save for your child’s education, especially with government grants and tax-sheltered growth. But one question that can make parents hesitate opening one: What happens to all that money if your child decides not to go to school? Let’s get into it.

There are plenty of reasons a child might not head to university right after high school. They might go straight into the work force, or decide that a traditional degree isn’t for them.

And that uncertainty can make parents wonder whether it’s worth putting money into an RESP in the first place.

That concern may be growing as more people question the value of a degree. According to a recent Abacus Data survey, only 18 per cent of Canadians and Americans said a college or university education is “definitely worth it,” while 69 per cent of Canadians said a degree is no longer the most reliable path to a secure career. Still, postsecondary education remains common: In 2025, nearly two-thirds of Canadian adults aged 25 to 64 held a college or university credential, up from 55 per cent in 2015, according to Statistics Canada.

The good news is that an RESP offers more flexibility than you might think.

For starters, an RESP can stay open for up to 35 years. Your child might not want to go to school at 18, but that doesn’t mean they won’t decide to pursue a degree, diploma, certificate or other qualifying program a few years down the road. And the federal government doesn’t limit RESP money for use only with traditional universities. A wide range of postsecondary institutions and programs, including career skills programs, can qualify.

Depending on the type of RESP, you may also be able to change the beneficiary (for example, to another child) although the rules around doing so and what happens to government grants depend on the plan and the beneficiaries’ relationship and age.

And if no one ends up using the RESP for school (or you don’t use all the money), that doesn’t necessarily mean you lose the money you’ve saved. Your original contributions can be taken back tax-free, and under certain conditions, you can transfer up to $50,000 of the investment growth into your RRSP, or a spousal RRSP, as long as you have enough contribution room. The catch is that any unused government grants and bonds have to be paid back.

One more thing to watch out for: If RESP earnings are withdrawn directly as an accumulated income payment (AIP) and not transferred to an RRSP, they are generally taxable at the marginal tax rate plus an additional 20 per cent tax (or 12 per cent in Quebec).

Increase in Air Canada shares on Wednesday after the country’s largest airline announced it would sell a 25-per-cent stake in Aeroplan to Blackstone and three Canadian pension funds for $2.5-billion.

FYI: If you’re one of Aeroplan’s more than 10 million active members, there’s no immediate change to how you earn or redeem points. Air Canada is still controlling the program.

Should Renata, 75, pay off her reverse mortgage to leave money for her sons?

The numbers: Renata has about $1.7-million in assets, including a $1.3-million Toronto condo, roughly $397,000 in investments and cash, and a municipal government pension.

The situation: Renata took out a reverse mortgage to buy a larger condo in 2021, but the balance has since grown from $400,000 to about $465,000. She wants to know whether she should downsize and pay it off so she can leave more money to her two adult sons, and also make sure she has enough for her own retirement and potential future care.

Key takeaways from a financial planner: Renata can afford to maintain her current lifestyle, but if she stays in her condo and keeps the reverse mortgage, it could eventually consume the home’s entire value. Downsizing to a $700,000 condo and paying off the mortgage could put her on track to leave her sons more than $2-million in today’s dollars. Another option is to stay put, use her investments and a roughly $75,000 HELOC to pay off the reverse mortgage, and cut annual spending to about $46,000, potentially allowing her to keep the home and eventually leave it to her sons, mortgage-free.