In a family RESP plan with multiple children, what happens if one of the children dies before using their share?

A family RESP plan is designed with some flexibility built in for exactly this kind of situation, since it generally allows the plan's earnings and government grant amounts to be shared among the plan's beneficiaries, within the program's rules, rather than being rigidly tied to one child alone. If one beneficiary dies before using their share of the plan, the subscriber can generally continue the plan for the remaining beneficiaries, and depending on the specific rules and how the plan was structured, amounts may be reallocated among the surviving children.

That said, the specifics, such as how grants attributable to the deceased child are treated, what documentation the RESP provider needs, and any conditions tied to the children's ages or relationships to each other, depend on the federal program's rules and the individual RESP provider's contract, not on a single simple formula. This is a situation where the promoter's own administration team can walk you through exactly what happens to that child's specific share.

Because losing a child is an already difficult situation, contacting the RESP provider early to understand the practical next steps for the plan can help avoid added stress later, once you know generally that the plan doesn't have to be unwound entirely.