Securing Your Child’s Future

01The big picture

Securing a child’s future has two halves: building (saving for education) and protecting (making sure the plan continues if something happens to a parent). This guide explains the official tools for both.

02RESP: the education savings account

• A Registered Education Savings Plan lets savings grow tax-sheltered until withdrawn for post-secondary education. (Source: Canada.ca, RC4092)
• RESPs are opened with an RESP promoter such as a bank, credit union or investment firm. Fees and features vary, so compare carefully.

03Canada Education Savings Grant (CESG)

• Basic CESG: 20% of the first $2,500 contributed each year, up to $500 per year per eligible child, regardless of income.
• Additional CESG on the first $500 contributed each year for low- and middle-income families, based on adjusted family net income. Check Canada.ca for the current income thresholds.
• Lifetime maximum: $7,200 per child. Unused basic grant room carries forward; the CESG is available until the end of the calendar year the child turns 17.

04Canada Learning Bond (CLB)

• For eligible children from low-income families born in 2004 or later: $500 for the first eligible year plus $100 for each further eligible year up to age 15, to a maximum of $2,000. No contributions are required. An additional $25 helps cover the cost of opening the RESP with the first bond. It must be requested before the beneficiary turns 21. (Canada.ca and RC4092)

05BC Training and Education Savings Grant (BCTESG)

• A one-time $1,200 grant into an eligible child’s RESP. Apply between the child’s 6th birthday and the day before their 9th birthday; child and guardian must be BC residents; no matching contribution required. (Source: Province of BC)

Checklist

• Does each child have a SIN? (needed to open an RESP and receive grants)
• Have we checked Canada Learning Bond eligibility?
• Is a calendar reminder set for the BCTESG window (age 6 to 9)?
• Are we using the $2,500 a year that attracts the basic CESG, or catching up on carried-forward room?

06Wills and guardianship (BC basics)

• In BC a parent can name a preferred guardian for their children in a will. The court acts in the child’s best interests and usually appoints the named person unless there is a good reason not to. If no guardian is named, the court decides, and the Public Guardian and Trustee may become involved. (Source: Province of BC, wills and estates)

• Do both parents have a current will?
• Have we named a guardian and talked with them?
• Who would manage money left to a minor child (a trustee)?
• Are beneficiary designations on RRSPs, TFSAs and insurance consistent with our wills? (A BC lawyer or notary can help.)

07The role of life insurance

• An education plan depends on someone continuing to contribute. Life insurance on a parent is one way some families make sure savings, housing and daily costs continue if that parent dies. See the Family Protection Checklist for how it works.
• Naming a minor child directly as a beneficiary can create complications; many families discuss a trustee or a trust with a lawyer.

→Next step

Want to talk it through? Book a complimentary 30-minute conversation with Amova Financials at amovafinancials.com/book.