With my son Brett ready to graduate from Ryerson and Kevan off to Queen’s in the fall, I’m frequently asked by clients how much it costs, and what is the best way to save. I tell them the first step is RESP’s (Registered Education Savings Plans). You need to start as soon as you child is born. We started with a small $25.00 a month automatic contribution. It’s amazing how quickly that grows, especially when the Canadian government provides a partial match to those amounts. My mom gives each of her grandchildren (she has 9!) $100 contribution to their RESP each year on their birthday till they turn 18.
No matter what your family income is, the Canadian government pays a basic CESG (Canadian Education Savings Grant) of 20% of annual contributions you make to all eligible RESPs for a qualifying beneficiary to a maximum CESG of $500 in respect of each beneficiary ($1,000 in CESG if there is unused grant room from a previous year), and a lifetime limit of $7,200. (from CRA website)
For more information on RESP’s, check the Canada Revenue website link here:
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/resp-reee/menu-eng.html
Next time: I’m a mean mom, just ask my kids, or “How I taught my kids to save for post-secondary education”