Canada Education Savings Grant

How Does the Canada Education Savings Grant Work?

The Canada Education Savings Grant (CESG) is essentially money that the Government adds to your child’s Registered Education Savings Plan (RESP). Introduced in 1998, the CESG is a financial incentive put forward by the Federal Government to help parents, relatives, and friends save for a child’s post-secondary education. After high school, the beneficiary can withdraw the money to help them pay for their full-time or part-time studies.

There are two parts to the CESG:

Basic CESG

With the basic CESG, the Canadian government matches 20% of any RESP contribution—$500.00 annually up to a lifetime maximum of $7,200. If you are unable to make a contribution in any given year, you may be able to catch up in future years.

Additional CESG

The Additional Canada Education Savings Grant money is provided by the Canadian Government for children who come from low-income and middle-income families. The money is added directly to the children’s RESP to help them get the maximum grant amount. The Additional CESG money is a supplement to any money they receive through the Basic Canada Education Savings Grant.

Eligibility Criteria

Basic CESG

The CESG is available until the end of the calendar year in which the recipient turns 17, as long as they meet some basic requirements: the child is a Canadian resident, has a valid Social Insurance Number, has an RESP opened in their name, and a request has been made for the grant.

Children who are 16 or 17 years of age may be eligible to receive the CESG if they meet at least one of the following criteria:

  • A total minimum of $2,000 was contributed to (and not withdrawn from) the RESP before the end of the calendar year in which they turned 15.
  • A minimum annual contribution of $100.00 was made to (and not withdrawn from) the RESP in at least four of the years before the end of the calendar year in which the recipient turned 15.

Additional CESG

The Additional CESG is available as long as the child is a Canadian citizen, has a valid Social Insurance Number, has an RESP opened in their name, has had contributions been made to their RESP, and the Additional CESG has been requested.

Depending on the family’s income, the beneficiary could receive an extra 10% or 20% on every dollar of the first $500.00 saved in their RESP annually. If your family net income is $45,282 or less, the first $500.00 contributed into the child’s RESP could add $100.00. That means you could receive up to $600.00 in CESG annually.

If your family’s net income is between $45,282 and $90,563, the first $500.00 contributed into the child’s RESP could add $50.00. That means you could receive up to $650.00 in CESG annually.

Net family incomes are updated annually. This example is based on 2016 income levels. No matter which Canada Education Savings Grant formula your family qualifies for, the lifetime maximum for each recipient remains at $7,200.

How to Apply

To receive the CESG you simple need to:

  • Open an RESP account and start to put money into it. Your RESP provider will apply for the CESG on your behalf.
  • Complete the CESG application form with the help of your RESP provider, and
  • Once approved, the education grant money is deposited directly into your child’s RESP.

Let Global RESP Corporation Help You

Why choose Global RESP Corporation (GRESP) to help you save for your child’s post-secondary education? The Dealing Representatives at GRESP specialize exclusively in RESPs. We can also help you apply for any CESGs.

As financial professionals, our goal is to help Canadian families build financial stability and ensure their investment into an RESP is secure and growing. In addition to providing flexibility and a wide range of investment opportunities, GRESP also has the lowest administrative fees in the market and no minimum plan contributions.

To learn more about opening a RESP and CESG options, talk to a Global RESP Corporation sales representative in your area. Or fill out a form and a Global RESP Corporation sales representative will contact you.

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