You probably already know that with a Registered Education Savings Plan (RESP), the government helps you save money for a child’s education. Through the Canada Education Savings Grant (CESG), the federal government matches of annual contributions to a maximum of $500 in CESG per year to a lifetime max of $7,200 per child And what could be better than that? Well for one, how about another grant called the Canada Learning Bond (CLB), which adds $500 to your RESP when you open it!
Kickstart your RESP with the CLB grant
The CLB is designed to kickstart your savings even further for families with lower incomes. In fact, what if we told you that eligible families can receive $500 right off the bat when an RESP is opened? Plus, you would get an extra $100 a year for each year you qualify for a total of $2,000. That money can be accessed when the child attends college, university, trade school or almost any career training program. Unlike the CESG, the CLB isn’t tied to how much you contribute to your plan. The child’s education savings grow even if you don’t have money to invest.
The CLB is a way for the government to help lower-income families start saving right away. After all, education is the best ticket to financial security.
Determining if you’re eligible for the CLB
Currently, to be eligible for the CLB, your adjusted net family income must be less than or equal to $46,605 (as per government Income Eligibility amounts released in 2018). However, if you have an extra busy household with more than three children, you can qualify for the CLB at higher income amounts. For example, the qualifying adjusted net family income for the CLB for a family with four children is $52,583. See qualifying income amounts for larger family sizes.
Eligibility for the CLB grant is based on the household income of the parent or caregiver of the child. So, if you are in a high-income bracket and are opening an RESP for a grandchild, niece or nephew, the RESP may still be eligible for the CLB.
Going for it: applying for the CLB
You can apply for the CLB while applying for the CESG grant at the time you start your RESP plan. Check your eligibility for CLB and inform your RESP provider during the application process.
Here’s some more happy news, you only have to apply for the CLB once, and you’ll continue to receive the grant year after year, as long as you’re eligible.
If you’ve already opened an RESP, but don’t think you applied for the CLB, no sweat. You can apply at any time through your RESP provider. If you qualify, the government will retroactively make CLB grant payments. Pretty great, eh?
Anyone can start saving for a child’s post-secondary education
In short, you don’t have to be a high earner with money to spare to begin saving for your child’s education. Even if you’re not where you want to be financially, there’s no reason you can’t start setting up that child in your life to fulfill the incredible potential you can already see.
What? More possible grants?
Before we wrap up, we should add that you might qualify for more grants. (Seriously!) To be sure you get all the money you are eligible for, it’s a good idea to go with an RESP provider that really knows RESPs. CST has been helping Canadians with their education savings for almost 60 years and we can help you apply for the grants you qualify for while helping your money grow.
We know there’s a lot riding on an RESP, so we do everything we can to maximize the benefits. Drop us a line today and we’ll be happy to set you up on a path to education savings growth and a glorious graduation ceremony (or many!).
CST Bright PlanTM is only sold by Prospectus. CST Spark is the distributor and Investment Fund Manager of CST Bright Plan.
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