A key feature that distinguishes RESPs from other registered or tax-deferred savings plans such as Registered Retirement Savings Plans (RRSPs) and Tax-Free Savings Accounts (TFSAs) is access to government grants. Canadian governments offers incentives to save towards post-secondary education in the form of federal and provincial grants.
At C.S.T. Consultants Inc., we simplify the process by applying directly to the federal government and relevant provincial governments at your request. Make the most of these incentives by managing your contributions effectively so that you can optimize this extra source of money.
Canada Education Savings Grant (CESG)
Offered by the government of Canada, the basic CESG is available to any Canadian resident that opens an RESP. The basic grant matches 20% of the first $2,500 you contribute to your child’s RESP each year, up to a lifetime maximum of $7,200 per child. That works out to an extra $500 paid directly into your child’s RESP every year.
If your family’s income falls below a certain level, your child’s RESP might qualify for 10% - 20% in Additional Canada Education Savings Grants on top of the basic 20% CESG. This works out to 10% to 20% additional grant contributions on the first $500 you save in your child’s RESP each year that you qualify for ACESG.
Canada Learning Bond (CLB)
Depending on your family’s income, your child’s RESP might be eligible for the Canada Learning Bond (CLB). The CLB is a grant in the amount of $500 paid directly into the beneficiaries RESP in the first year that they qualify and $100 for each subsequent year that they qualify until the child turns 15.
Quebec Education Savings Incentive (QESI)
Offered by the government of Quebec, QESI provides 10% on the first $2,500 contributed annually to an RESP by residents of Quebec up to a lifetime maximum of $3,600.
If you are a resident of Quebec and your family’s income falls below a certain level, your child’s RESP might qualify for another 5% - 10% on the first $500 contributed each year to your child’s RESP.
Alberta Centennial Education Savings Grant (ACES)
The Alberta government has announced the closure of the Alberta Centennial Education Savings Plan (ACES) grant program. Children of Alberta residents born before April 1st, 2015 who are under the age of 6 may still be eligible to receive the $500 grant in their RESP. As well, grants of $100 are available to children of Alberta residents who turned 8, 11 and/or 14 on or before March 31st, 2015, provided that the children are attending school and a new application is submitted. All grant applications must be received by July 31st, 2015 to be eligible.
Saskatchewan Advantage Grant for Education Savings (SAGES)
Offered by the government of Saskatchewan, SAGES provides 10% of the first $2,500 contributed annually to an RESP by residents of Saskatchewan to a lifetime maximum of $4,500. Learn more about the Start Early Saskatchewan and the grant program.
British Columbia Training and Education Savings Grant
Grant is expected in 2015. Your child could be eligible for a one-time education savings grant of $1,200 paid into an RESP for any B.C. resident child who turns six years old.