RESP grants: the free $500 a year.
The government will add money to your child’s education savings, but only if the RESP is set up and used the right way. Here’s how to collect all of it.
How the grant works
The Canada Education Savings Grant adds 20% to what you put into an RESP each year, on the first $2,500. Put in $2,500 and the government adds $500. It keeps doing that every year, until your child has received $7,200 in total.
- $500
- Grant per child per year: 20% on the first $2,500.
- $1,000
- The most grant in one year, when you’re catching up on missed years.
- $7,200
- The lifetime grant limit per child.
- $2,000
- Up to this much from the Canada Learning Bond, for eligible lower-income families.
Missed a few years? You can catch up
Grant room builds up every year from birth, whether or not you contribute. If you missed years, you can put in more than $2,500 in a year and the grant is paid on up to $5,000, for up to $1,000 of grant a year, until the unused room or the $7,200 limit runs out.
An example: $2,500 a year for 15 years is $37,500 from you, plus $7,200 in grants, before any growth.
The deadline, and the rules at 16 and 17
The grant can be paid until the end of the year your child turns 17. But at 16 and 17 it’s only paid if the RESP already had at least $2,000 in contributions by the end of the year they turned 15, or at least $100 a year in any four earlier years. If you’re starting late, start before 15.
The Canada Learning Bond
For eligible lower-income families, the Canada Learning Bond can add up to $2,000 to a child’s RESP, and you don’t have to contribute anything to get it. You do need an RESP open to receive it. Families with lower or middle incomes may also qualify for a little extra grant on the first $500 they contribute each year.
Things people ask
Does Ontario add its own grant?
No. A few provinces do, but Ontario doesn’t.
Do I need my child’s SIN?
Yes. The grant is only paid once your child has a Social Insurance Number and is named on the plan.
What if my child doesn’t go on to school?
Your contributions come back to you. The grants go back to the government. The growth has its own rules, and there are options worth going through if it ever comes up.
Is there a limit on what I can put in?
There’s no yearly limit, but there is a $50,000 lifetime contribution limit per child. The grant is only paid on the first $2,500 a year (or $5,000 when catching up).
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