Alberta newborns get $500 head start towards their education future
Edmonton... Alberta's youngest residents now qualify for a financial boost to their post-secondary education savings, thanks to the new Alberta Centennial Education Savings Plan, the first provincial program of its kind in Canada.
The plan is designed to give Alberta parents an incentive to start planning and saving for their children's post-secondary education as early as possible. It will make available $500 towards a Registered Education Savings Plan (RESP) for every child born to or adopted by Alberta residents in 2005 and after. Subsequent grants of $100 will be available to children attending school in Alberta at ages 8, 11 and 14, starting in 2013.
"This program is a centennial gift to Alberta's students of tomorrow," said Premier Ralph Klein. "It's a valuable and tangible way to help mark the province's 100th birthday, and will be a lasting legacy for Alberta's future generation of leaders, skilled workers and professionals."
To receive the $500 grant, a parent must first register the birth of his or her baby and obtain a Social Insurance Number for the child. The next step is to open an RESP in the child's name. Once the parent opens the RESP, he or she can then request the Alberta Centennial Education Savings Grant and will be guided through the application process by the bank or RESP provider.
"This $500 represents a good start for Alberta's centennial children, but it's important that parents continue contributing to their children's RESPs and encouraging them to pursue higher education, so that all Alberta children feel empowered to go on to post-secondary education and realize their full potential in life," said Advanced Education and Technology Minister Dave Hancock. "Planning and saving for post?secondary education is one of the best things parents can do for their children's future."
It is estimated that about 40,000 children will be eligible for the plan each year. The Alberta government will invest $20 million annually in program, with that number growing to $30 million annually by 2019. The program will be jointly administered by the Government of Alberta and the Government of Canada, and will utilize the federal government's verification, payment and compliance procedures for RESPs.
For more information on the Alberta Centennial Education Savings Plan, please visit www.gov.ab.ca or call 310-4455 (toll-free in Alberta).
Backgrounder
The Alberta Centennial Education Savings Plan
Facts and stats- The Alberta Centennial Education Savings Plan is the first provincial program of its kind in Canada.
- The concept was the vision of Denis Herard, MLA for Calgary-Egmont.
- The Alberta government will invest $20 million annually in the Alberta Centennial Education Savings Plan, with that number growing to $30 million annually by 2019.
- Approximately 40,000 children will be eligible for the Alberta Centennial Education Savings Grant each year.
- According to the Canadian Association of Not for Profit RESP Dealers, 80 per cent of children with RESPs in their names go on to post-secondary studies.
- According to a recent report from TD Bank Financial Group, the annual return on investment is 12 to 20 per cent for a university degree and 15 to 28 per cent for a college diploma - after tax and after inflation. A typical investment portfolio would generate six to eight per cent, before taxes and inflation.
- Investment in higher levels of learning generates more than financial returns. It also contributes to a child's future success, health and well-being, and the ability to be a responsible and contributing citizen.
- Investment in learning also benefits society in general, translating into economic prosperity, enhanced global competitiveness, increased innovation, and safe and caring communities for all Albertans.
