It’s probably the thing new parents hear the most from well-meaning people in their lives–enjoy it, it goes so quickly, (or some variation). It does go quickly. There’s no denying that. So talking about saving for your child’s education after high school graduation is never premature.

What is an RESP?

Most people are familiar with a Registered Educational Savings Plan (RESP). It’s a tax-deferred savings plan that makes it easier to save money for a child’s post-secondary education. Opening an RESP also opens the door to additional money from the government. The federal government supplements RESP contributions, matching up to 20 per cent of your annual contribution (to a maximum of $500 per beneficiary per calendar year).

Finding the money for your contribution.

Enter the Canada Child Benefit (CCB), which replaced the Universal Child Care Benefit (UCCB) and Canada Child Tax Benefit (CCTB) in 2016. Canadian parents are now receiving a maximum of $6,400 per year for each child under the age of six, and up to $5,400 per year for each child aged six to 17. How much you qualify for depends on your adjusted family net income and number of children. See where we’re going with this?

So, there it is—the money you’ve been missing to get that RESP started. Even a portion of it could make a difference a decade or more down the road—when your diaper and daycare bills have morphed into tuition and textbook costs.

Unlike the UCCB, the CCB is a tax-free benefit that is paid monthly and is not considered income. This means that it will not impact income-tested benefits and it is not reported on your tax return. CCB payments are calculated in July according to your adjusted family net income from the previous year. 

Wondering if this is the time to get an RESP started? We’d love to help you. Visit a financial specialist at any of our branches​, call our ATB Client Care at 1-800-332-8383.