Alberta cutting RESP grant program
Province will no longer put $500 into new educational savings accounts
The Alberta government is moving toward cutting a grant program that deposits hundreds of dollars into educational savings accounts for children.
The Alberta Centennial Education Savings grant puts $500 into new Registered Education Savings Plan accounts that parents open for children born in 2005 or later. The grant also includes $100 deposits when the child reaches 8, 11 and 14, as long as parents are contributing as much into the accounts.
But the Alberta government says it is phasing out the program.
"All Albertans who are currently enrolled in the ACES program will continue to have their money invested in their child's RESPs," says a note on the government's website.
Once the program ends, no more money will be given out, including the $100 top-ups.
Myles Rempel, a spokesperson for Ten Star Financial in Calgary, said the decision likely won't have a significant impact on most parents, who will continue saving money to put their kids through college or university.
"Everything helps, but probably you're looking at $5,000 to $10,000 a year in cost."
Low-income families benefit from RESPs
Donna McBride, who works for a community economic development society called Momentum, said children from low-income families are more likely to go on to higher education if they have a savings account in their name.
"It's extremely important for families who struggle month-to-month just to pay their bills to look at it terms of a long-term investment. When that family has an RESP that has some government money in it, it already changes the dynamic of that family. It changes the expectation of how those children's future can roll out."
The Alberta government is still processing applications since no date has been set for the end of the program.
Registered Education Savings Plans, which are part of a federal government program, are not otherwise impacted by Alberta's decision.