Canada Education Savings Grant (CESG) - a grant from the Government of Canada which encourages Canadian families to start saving for children's education after high school.
Registered Education Savings Plan (RESP) - a registered account where you can start savings for your child's future education. This account can be opened at almost any financial institution. For the certain amount invested every year, government can pay up to $500 Cad in grant into this registered account. The Canada Education Savings Grant applies to all children up to age 17, that are Canadian citizens and have RESP account. Note, special rules apply for children between ages 15 and 17.
How To Get the Canada Education Savings Grant?
1) Get a Social Insurance Number (SIN). Note, there is no age restrictions who can have the SIN number, even baby can get one.
2) Open a RESP account with a financial institution such as bank or credit union. Some certified financial planners or group plan dealers can do that for you too.
Facts About RESP
1) RESP is a special savings account registered with the Government of Canada.
2) RESP money can be invested. Consult your financial institution to obtain the best interest rate. You will not be charged on the interest the account makes, and child can usually withdraw this money tax-free.
3) Every penny counts. For any amount you invest in child's RESP, the child will receive grant.
4) Not only parents, but friends and family can contribute to your child's RESP.
5) The sooner you start, the more you will save for your child's future education.
How Much Grant Your Child Will Receive?
On the first $500 parent saves in child's RESP, you can receive:
- up to $200 for the family with net income* of $37,885 or less
- up to $150 for the family with net income* between $37,885 and $75,769
- up to $100 for the family with net income* of $75,769 or more
*Income amounts are for 2008. Family income's are updated every year, check with Government of Canada.
Note, the maximum grant a child can receive is between $500 and $600 per year, and the life time total of $7,200.
For more information you can call 1 800 O-Canada (1-800-622-6232)