Investing in Life – The SJH Blog

RESPs and Education Planning for Teens

Education Today

Education Planning

Attention parents of surly teens!


If you have a Registered Education Savings Plan (RESP) or are thinking of opening one and your child is turning 15, 16 or 17 this year, there are some steps we may need to take to ensure your plan qualifies to receive the Canada Education Savings Grant (CESG).


In the year they turn 16 or 17, kids are eligible for the CESG only if:


  • Their RESP’s gave received at least $2000 in contributions before they turned 15 (This refers to the calendar year in which they turn 15 not the actual birthdate). OR
  • Their RESP’s received at least $100 in contributions in any four years before they year they turned 15.


Note that your plan does not have to meet both requirements, only one. That said, if any portion of those minimum contributions was withdrawn from the account, they lose their CESG eligibility.


In other words, if you wait until your child is 16 or 17 with the intention of opening a kind of “last minute” RESP; the plan won’t be eligible for any grant money. Otherwise, as long as you’ve been contributing regularly, you should be okay.


Please note that these special rules apply only to eligibility for Canada Education Savings Grant. They do not apply, for example, to RESP holders in Quebec who qualify for the Quebec Education Savings Incentive (QESI).


If you have not yet started an RESP and you have a teen turning 15 this year, be sure to contact us soon (514-747-6565).  Your plan can still qualify for the CESG as long as you open it and contribute before the end of the year.


(This article was provided by Ariad Communications)

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