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Government Grants Offered to Parents

Government Grants Offered to Parents

January 27, 2023

The government is offering free money to help educate your children, writes Peter Watson.

Today a question. If you could make an investment that provided a 20 per cent return guarantee in the first year, would that be of interest?

There are no hidden glitches. You can invest with the financial institution of your choice and determine the specific investment.

The final temptation of this offer is these funds can be used to provide financing for a university education for your children or grandchildren.

This might sound “too good to be true.”

The offer is real and is being made by the Government of Canada. It is the Registered Education Savings Plan (RESP). It is a financial incentive intended to encourage family members to save for their children’s university education.

The incentive applies to many other forms of postsecondary education too. Including college and trade school.

Many families intend to assist their children with their post-secondary education. Our suggestion to parents and potentially grandparents is to take the free money the government is offering by contributing to an RESP.

The 20 per cent guarantee comes in the form of a government grant. The grant is 20 per cent of the first $2500 contributed annually to a RESP for a total of $500 per child per year.

The lifetime maximum grant for each child is $7200 up to the age 18. Because of the $500 annual grant limit this requires RESP contributions over approximately a 14-year period.

RESP is a very generous offer from the government.

Peter Watson is registered with Aligned Capital Partners Inc. (ACPI) to provide investment advice. Investment products are provided by ACPI. ACPI is a member of the Investment Industry Regulatory Organization of Canada. The opinions expressed are those of the author and not necessarily those of ACPI. Only investment-related products and services are offered through Watson Securities of ACPI. Peter Watson provides wealth management services through Watson Investments. He can be reached at