Need a source? - Federal Budget 2007: more flexibility for education savings



    Education savings provider available to discuss how budget helps parents
    save for child's post-secondary education

    TORONTO, March 20 /CNW/ - Finance Minister Jim Flaherty announced on
March 19 that the 2007 Federal Budget includes "measures to provide more
flexibility to families who save through Registered Education Savings Plans
(RESPs)."
    Canadian Scholarship Trust Foundation (C.S.T.) commends the federal
government for encouraging families to save for their child's post-secondary
education with changes to Canada's education savings program that provide
additional incentives and flexibility.
    
    Federal budget 2007 proposes to:
    -  Eliminate the $4,000 annual RESP contribution limit and increase the
       lifetime contribution limit to $50,000 from $42,000
    -  Increase the annual maximum contribution that qualifies for the 20 per
       cent Canada Education Savings Grant (CESG) incentive to $2,500 from
       $2,000 - for a yearly maximum CESG of $500, up from $400.
        -  The maximum CESG for a year will increase to $1,000 from $800 if
           there is unused grant room from previous years
        -  The lifetime CESG limit remains at $7,200
    

    "Taking the cap off annual RESP contribution limits and increasing the
annual CESG limit creates more flexibility for families," says Peter Lewis,
Vice President, Canadian Scholarship Trust Foundation. "It's particularly
helpful for families who don't have the money to start saving until their
child is older or who would like to make larger contributions in a shorter
period of time. Although starting to save early is the best strategy to
maximize an RESP's savings potential, these new measures will make it easier
for families to catch up more quickly and build savings plans that work with
their needs."
    An RESP is an education savings plan registered under the Federal Income
Tax Act that helps families save for post-secondary education. Income earned
on contributions grows tax-free until a child is ready to attend college,
university or even trade school.
    Peter Lewis is available to talk about how parents can maximize their
education savings potential and make these changes work to their benefit. He
can also discuss how government incentives effectively motivate families to
save for education.

    The Canadian Scholarship Trust Foundation, founded in 1960, is the oldest
and largest provider of Registered Education Savings Plans (RESPs) in Canada
with more than $2 billion in assets under administration. Its mission is to
promote the benefits of higher education and improve access by reducing
financial barriers and providing wide distribution of RESPs.





For further information:

For further information: To arrange an interview, please contact: Myra
Reisler, Tonique Harry, (416) 504-8464, myra@mediaprofile.com,
tonique@mediaprofile.com

Organization Profile

CANADIAN SCHOLARSHIP TRUST FOUNDATION

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FEDERAL BUDGET REACTION 2007

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