Consult with your financial accountant to achieve the best results, and protect your income regarding these matters. In the plan's first 21 years you can invest. Then no further contributions can be done. None of the plan's capital gains, interest, or dividend earnings will be taxed as they grow in value. Income tax is not owed until the money is withdrawn, allowing the invested money to grow tax free.
Income tax is owed, when the student enters a post-secondary institution.
Then the money is taxed in the student's hands, usually this would be at the lowest income tax rate. This grant is available to the beneficiary every year until they turn 18. Worthwhile checking out. Self-directed Registered Retirement Savings Plan. The loan is to buy a home only.