November 14-18, 2022 is Education Savings Week. Canadians are encouraged to start saving early for a child’s post-secondary education.
With over 70% of future jobs projected to require post-secondary education, the Canadian government has education savings incentives to help make post-secondary education more affordable for families.
The Canada Savings Bond is a grant (free money) that is put into a RESP (Registered Education Savings Plan) for a child.
Children and Youth born after January 1, 2004 can benefit from potentially thousands of dollars in grants from the Canadian government. By opening a RESP for each child, the application will assess a family’s eligibility for the Canada Learning Bond and automatically deposit any entitlement into the RESP. If additional contributions are made to the RESP, the government will top up the contributions through the Canada Education Savings Grant.
Quick Review
RESPs can be opened by anyone to help to save for a child’s education after high school: a parent, a grandparent, a family friend, a foster parent or a public primary caregiver.
Education savings grow tax-free within the Registered Education Savings Plan. They are the only savings account that the Government of Canada provides education savings incentives for. They are:
- the Canada Learning Bond, which provides up to $2,000 in a RESP for children in income-eligible families, born in 2004 or later up to the age of 15, with no personal contributions required
and
- the Canada Education Savings Grant, which adds between 20 and 40 percent of personal contributions to a RESP for all eligible children, depending on family income and the amount contributed
The money saved in a RESP can be used for tuition and expenses including books, tools, rent, and transportation.
If you want to start saving for a child’s post-secondary education, start today!
