Canada Learning Bond paying off for low income families

The Canadian Scholarship Trust Foundation
News Release

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TORONTO - Since December 31, 2005, the federal government's Canada Learning Bond (CLB) payments have grown from $2.7 million to $20 million, according to a Canada Education Savings Program report.

The 2006 Fourth Quarter Statistical Review cites an increase of more than 650 per cent in the number of CLB beneficiaries - from 4,630 to nearly 31,500 children, indicating a significant surge in education savings among low-income families.

"We're pleased to see more parents taking advantage of the CLB grant, as it will help give their children a chance to achieve their full learning potential," said Peter Lewis, Vice President, Canadian Scholarship Trust Foundation.

"Even if parents can't afford to make regular contributions, the CLB will earn interest in an RESP until their child is ready to attend a college or university."

The CLB provides up to $2,000 for the post-secondary education of children in lower income families. Canadian children born January 1, 2004 or later who are eligible for the National Child Benefit Supplement (NCBS) are eligible for the CLB (this generally applies to families with a total annual income under $35,000). The CLB encourages families to set up a Registered Education Savings Plan (RESP).

Any RESP contributions beyond the CLB qualify for the Canada Education Savings Grant (CESG), which adds 20 per cent of all contributions made to a maximum grant of $500 per year per child. Low-income families that receive the CLB are also eligible for an additional 20 per cent CESG on the first $500 contributed each year.

Studies show that parents' attitudes toward, and saving for, post-secondary education communicate a strong message to their child about the value of pursuing higher education - and set the expectation that the child will go on past secondary school. According to Statistics Canada, young Canadians who had savings put aside for their post-secondary education either by themselves, their parents or others were more likely to take some post-secondary education (74 per cent compared with 50 per cent).

C.S.T. has made changes to its individual and family RESPs to make it easier for CLB-eligible families to enrol, waiving the usual minimum contribution requirement and set-up fees. The initial $500 CLB is invested along with any additional contributions families can make at a flexible
schedule.


The Canadian Scholarship Trust Foundation, founded in 1960, is the oldest and largest provider of RESPs in Canada, with more than $2.3 billion in assets
under administration. Its mission is to promote the benefits of higher education and improve access by reducing financial barriers.

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