Canada Education Savings Grant (CESG)
Each one of your children qualifies for up to $7,200 towards any kind of post-secondary education: university, college, vocational or trades apprenticeship.
Consider how much that will grow over the years – and the debt it will spare them. It's worth going after that money!
You don't even need to apply for it. Just ask your credit union or bank to open an RESP for each of your children. An RESP is a Registered Education Savings Plan. You just need a Social Insurance Number (SIN) for each child. (For instructions, see the links at the end of this article.) If your bank or credit union charges to open an RESP, shop around for the lowest fee.
Like a special savings account, a RESP helps you save for your child's education. It's registered by the federal government, so your savings grow tax-free, pumped up by the automatic CESG grant contributions.
You don't get this grant money all at once. The government deposits money into your child's RESP gradually over the years. What you get depends on your income, how long you keep the RESP going and how much you invest in those RESPs yourself.
What if you can't afford to put money in a RESP right now?
Maybe you'd like to get started but you're still paying off your student loans? Well, maybe you don't need to wait. Check out the Canada Learning Bond.
How much money can your kids get from the Grant?
Amounts change each year. For 2008, the government offers the following amounts for the first $500 you save in each of your children's RESPs:
- up to $200, if your net family income is $37,885 or less;
- up to $150, if your net family income is between $37,885 and $75,769;
- up to $100, if your net family income is more than $75,769.
When you save more than $500 annually, the Canada Education Savings Grant could add up to $400 on the next $2,000.
Each child is eligible for an annual amount up to 'between $500 and $600' as the government puts it. The maximum grant money for each child's lifetime is $7,200.
Even if you can't afford to claim that much, tax-free interest compounding makes small amounts grow nicely if you just start early.
