The Canada Learning Bond: A Great Start for Education Savings

LIttle girl at a playground

May Wong, Executive Director, Omega Foundation

Ask any child what she wants to be when she grows up. Odds are she's going to need some education after high school to achieve her goal.

Just about all parents, regardless of their income or education, want their kids to get a higher education. While encouragement helps a lot, it alone can't always make it financially possible. Kids from lower-income families are less likely to go to post-secondary, even if they have excellent grades and their parents make education a priority. For many kids, not knowing how they'll ever pay for school even discourages them from applying. It doesn’t take a lot to turn this around. Even a small amount of savings increases the chance that youth will continue their education by 50%.

Most parents believe it's their responsibility to pay for at least part of their child’s education, but many don’t know how they'll ever do it. The Canada Learning Bond (CLB) is a great way to start.

The Canada Learning Bond is a contribution by the Federal government into the Registered Education Savings Plan (RESP) of a lower-income child. It gives each child up to $2,000 to save towards their post-secondary education. The Bond is available to any child born since 2004 whose family receives the National Child Benefit Supplement (also known as "family allowance"). Families don’t have to contribute any money, but they do have to start an RESP to receive the CLB. An RESP can be started without fees and without contributions at many financial institutions including the Canadian Scholarship Trust Foundation to receive the Bond.

A lot of higher-income families already know the benefits of tax-sheltered saving and built-in return on investment provided by the RESP and Canada Education Savings Grant. But many lower-income parents eligible for the CLB are unaware of these opportunities. They may be newer to Canada, may have less financial experience or no one to talk to about their finances. According to the latest statistics, over 70% of kids who are eligible for the CLB right now aren't receiving it - mainly because their parents don't know about it or don't know how to get it.

You can help.

SmartSAVER has worked with over 1,000 community organizations, from schools to churches and trained over 15,000 parents and community workers on RESPs. What we've learned is that everyone knows someone who's eligible for the Canada Learning Bond and families welcome the chance to get the Bond for their kids...once they find out about it.

We all benefit when all kids have the chance to succeed. Talk to parents you know about the Canada Learning Bond or suggest they visit us at www.smartsaver.org. Forward this message or like SmartSAVER on Facebook, follow us on Twitter or share our YouTube videos.

SmartSAVER is a project of the Omega Foundation.