OTTAWA, Nov. 17, 2014 /CNW/ - The Honourable Candice Bergen, Minister of State for Social Development, marked Financial Literacy month by highlighting the importance of saving for children's post-secondary education at an event hosted by Meridian, Ontario's largest credit union. "Start my RESP," an innovative online tool developed by the Omega Foundation's SmartSAVER program to facilitate access to federal education savings incentives, was introduced at the event.
Minister Bergen spoke about the benefits of using Registered Education Savings Plans (RESPs) to help save for a child's education after high school. She stressed the important role financial institutions play in informing Canadians how they can invest in their children's future with support from the Government of Canada.
As part of its focus on making life more affordable for families, the Government offers education savings incentives like the Canada Learning Bond. The $500 Bond is deposited directly into the RESPs of eligible children, some of whom may qualify for an additional $100 per year, up to a maximum of $2,000. Parents, or primary caregivers, do not have to contribute any of their own money to receive the Bond.
Families can also apply for the Canada Education Savings Grant. The federal government adds between 20 and 40 percent to an RESP, depending on net family income and contributions, up to a maximum of $600 per year, contributing a lifetime maximum of $7,200 per child. By the end of 2013, over 47% of children under the age of 18 had received the Canada Education Savings Grant.
Financial Literacy Month takes place annually during the month of November, led by the Financial Consumer Agency of Canada, and aims to promote the importance of financial planning and financial literacy for Canadians.
- Omega received an investment of $749,000 from the Government of Canada to set up its SmartSAVER project.
- Since the introduction of the Canada Learning Bond, the Government of Canada has provided Canadian families with nearly $500 million for their children's post-secondary education.
- Over 600,000 children have received the Canada Learning Bond since its creation.
- Over 350,000 students withdrew $2.74 billion from their RESPs in 2013—representing an increase in the number of students of 8.7% over 2012.
"Our government is committed to making life more affordable for hard-working Canadian families. That's why, in addition to all of our family-friendly measures, we also offer education savings incentives such as the RESP. I'm happy to join Meridian Credit Union and the Omega Foundation to applaud the work they are doing to help families access the benefits available to them."
– The Honourable Candice Bergen, Minister of State for Social Development
"We are excited to celebrate Canada's first Education Saving Week and believe that all parents—regardless of income—dream about being able to afford to send their child to college or university. By contributing to a Registered Education Saving Plan and taking advantage of government grants and bonds, parents can make that dream a reality."
– Scott Windsor, Vice President, Corporate Communications, Meridian
"We thank the Minister and Meridian for demonstrating SmartSAVER's new RESP starter, just introduced on SmartSAVER.org in celebration of Education Savings Week. We'd like to recognize the leadership of our financial institution partners, BMO, Scotiabank, Vancity and Meridian who share our belief that every child deserves the opportunity to pursue higher education. Through SmartSAVER.org these leading financial institutions are providing families with the opportunity to establish an RESP at no cost or minimum investment to start saving with the Canada Learning Bond."
– Martin Connell, President and CEO, Omega Foundation
Government of Canada savings incentives for post-secondary education
Communities across Canada are recognizing November 16 to 22 as Education Savings Week. These communities are bringing awareness of the benefits for families to save for their children's post-secondary education by taking advantage of federal education savings incentives.
The Government of Canada offers money to help Canadians with education savings. The Canada Learning Bond was introduced to help modest-income families save for their children's education. To receive the Canada Learning Bond, a child must have been born in 2004 or later. The primary caregiver must also receive (or have received) the National Child Benefit Supplement under the Canada Child Tax Benefit (sometimes known as the family allowance or "baby bonus").
Families can also receive the Canada Education Savings Grant when opening a Registered Education Savings Plan (RESP).
For information on how to apply for the Canada Learning Bond and other education savings incentives, visit CanLearn.ca or call 1 800 O-Canada (1-800-622-6232).
The Harper government has recently introduced some additional new proposed measures to make life more affordable for Canadian families. These include:
- Increasing the Universal Child Care Benefit (UCCB) for children under age 6. Parents will receive a benefit of $160 per month for each child under the age of 6—up from $100 per month—as of January 1, 2015. In a year, a parent would receive up to $1,920 per child.
- Expanding the UCCB to children aged 6 through 17. Under the expanded UCCB, parents will receive a benefit of $60 per month as of January 1, 2015, for children aged 6 through 17. In a year, a parent would receive up to $720 per child.
- Introducing the Family Tax Cut, a federal tax credit that will allow a spouse to, in effect, transfer up to $50,000 of taxable income to a spouse in a lower tax bracket. The credit will provide tax relief—capped at $2,000—for couples with children under the age of 18, effective for the 2014 taxation year. Income splitting has been helping seniors across the country, which is why the Government is now providing similar relief for families.
- Increasing the Child Care Expense Deduction dollar limits by $1,000, effective for the 2015 taxation year. The maximum amounts that can be claimed will increase to $8,000 from $7,000 for children under age 7; to $5,000 from $4,000 for children aged 7 through 16 (and infirm dependent children over age 16); and to $11,000 from $10,000 for children who are eligible for the Disability Tax Credit.
- Doubling the Children's Fitness Tax Credit from its current limit to $1,000 for the 2014 tax year and subsequent tax years; effective the 2015 and subsequent tax years, the credit will be made refundable.
Families can claim the Family Tax Cut in the spring of 2015 when they file their 2014 tax returns. They will begin to receive payments under the enhanced UCCB in July 2015. The July UCCB payment will include up to six months of benefits to cover the period from January through June 2015.
The enhanced UCCB will replace the existing Child Tax Credit for the 2015 and subsequent taxation years.
SOURCE: Employment and Social Development Canada
For further information: Media Relations Office, Employment and Social Development Canada, 819-994-5559, [email protected], Follow us on Twitter