The Canada Education Savings Grant (CESG): Unlock Its Benefits

When it comes to saving money for your child’s post-secondary education, every dollar counts. When you open a Registered Education Savings Plan (RESP), the government of Canada will automatically match a portion of your contributions through a government grant known as the Canada Education Savings Grant (CESG) to help cover the rising cost of education.

What is the Canada Education Savings Grant?

The CESG is a federal government program designed to encourage families to save for their child’s post-secondary education through an RESP account. This grant money is administered by Employment and Social Development Canada (ESDC).
When you contribute to your child’s RESP account, the government will match 20% of your contribution to help you grow your savings faster. The CESG is available to all Canadian children with a valid social insurance number (SIN), regardless of household income.

How the Basic CESG Works

The Canada Education Savings Grant provides a 20% match on the first $2,500 you contribute each year to your child’s education, which comes out to $500 a year, per child. Over time, the maximum CESG your child can receive is $7,200.

Example

If you contribute $2,500 into an RESP for 15 years, while a 20% match would be $7,500, because of the lifetime CESG contribution limit, you’ll only be entitled to $7,200 per beneficiary.

Ultimately, the earlier you start, the easier it will be to reach the full grant money. We recommend opening an RESP when your child is a baby and contributing consistently over the years.

Additional CESG for Lower-Income Families

Lower and modest-income families may qualify for additional CESG, which is added on top of the standard 20% grant match on the first $500 contributed annually. This is how it works:

Adjusted Family Net Income	Additional CESG	Total CESG on First $500
$57,375 or less	20%	40%
$57,375–$114,750	10%	30%
Over $114,750	—	20%

The additional CESG money ensures that education savings are accessible to all families, even if they are only able to contribute a modest amount each year.

Catch-Up RESP Contributions to Claim Unused Grant Room

If you weren’t able to contribute money to your RESP early on, you can catch up on some of the CESG. Missed contributions can be carried forward until your eligible children turn 17.

Here’s how catch-up rules work:

Let’s say you missed contributions in 2023. The following year, you choose to deposit $5,000 in your RESP. In return, you’ll receive $1,000 from the CESG to make up for the previous year. This strategy can be especially beneficial for families who have started saving late or weren’t able to contribute each year.

Eligibility & Application Process

To qualify for the CESG, you need to meet the following eligibility criteria:

• The child (beneficiary) must be a Canadian resident and have a valid Social Insurance Number (SIN).
• You (the subscriber) also need a valid SIN.
• You must open an RESP with a participating provider like Embark.

Once you open an RESP account, you can apply for the CESG. Embark automatically applies for the CESG on our plan holders’ behalf. No additional application form is required. However, not all RESP providers offer this benefit.

Age Requirements

CESG contributions are only to eligible beneficiaries up until December 31st of the year they turn 17. If your child is 16 or 17, the following conditions must also be met:

At least $2,000 was contributed before the end of the calendar year they turn 15 or;
At least $100 was contributed in any 4 years before the year they turn 15.

Combining CESG with Other Grants

Beyond the CESG, other government grants are available that you may qualify for, including:

• The Canada Learning Bond (CLB): Up to $2,000 for eligible low-income families with no contributions required.
• British Columbia Training and Education Savings Grant (BCTESG): One-time $1,200 grant for residents of British Columbia.
• Quebec Education Savings Incentive(QESI): Up to $250 per year, capped at $3,600 lifetime limit.

Note: These additional grants don’t count toward the lifetime CESG limit of $7,200.

Avoiding Repayments & Common Mistakes

The CESG is a fantastic tool that your child can use to pursue post-secondary education. However, there are a few ways you could unintentionally trigger a grant repayment:

Over-contributing to your RESP

RESPs have a maximum lifetime limit of $50,000. Depositing more than the maximum amount can result in a tax penalty being triggered.

Withdrawing CESG funds early

Withdrawing money from your child’s RESP when they aren’t enrolled in an eligible post-secondary program may result in having to repay your grant money.

Changing beneficiaries

Transferring money from one child’s RESP to another when there is no contribution room left can lead to over-contributions.

Best Practices

• Set up automated contributions of $210 per month to stay on track for the full CESG amounts per calendar year.
• Set calendar reminders or opt in for notifications from your RESP provider.
• Check your RESP balances and grant tracking annually using your provider or CRA My Account.
• If you have a family plan, coordinate with other contributors to avoid over-contributing.
• Make final contributions before December 31st to ensure you qualify for your annual CESG contribution.

Don’t Miss Out on Free Money!

The CESG is one of the most effective ways you can save for your child’s future education, and understanding RESP benefits is a key first step. Start saving early and remain consistent to give your child the best chances of a brighter future.

At Embark, we make it easy to open an RESP, set up automatic contributions, and track your grant room, so you can make the most out of your savings.

Contact an Education Savings Specialist to learn more about your options today.