Skip to content
Canajun Finances Home » RESP: Helping Lower Income Families RESP: Helping Lower Income Families

Robb Engen from over at Boomer and Echo sent me over an interesting e-mail for a new concept backed by most major banks (and credit unions) in Canada to help children of lower-income Canadians take advantage of the Canada Learning Bond (CLB)  in the Registered Education Savings Plan (RESP) .

To quote :

More than 1.4 million low-income children don’t receive the government education funding they’re eligible for because they don’t have a Registered Education Savings Plan (RESP). In fact, in Ontario, only 31% of children who qualify for the Canada Learning Bond (a contribution of up to $2,000 towards future education) – have received it. Launched today*, a new online application at is designed to help Canadians open RESPs and access the Canada Learning Bond for their children.

*- where today was January 26th, 2015

While these numbers don’t surprise me, they do worry me, because my opinion is education empowers folks, and gives them choices. The more money lower-income families can accumulate to help their kids have the chance to attend post-secondary programs, the better it is for the economy.

The official announcement from The Omega Foundation states:

In a joint initiative, BMO, Meridian, RBC Royal Bank, Scotiabank, TD and Vancity have come together to support SmartSAVER, committing to establish RESPs for lower-income families with no fees and no minimum contribution to help them access the federal government’s Canada Learning Bond. Families can apply for the Canada Learning Bond through SmartSAVER’s online application form in less than 10 minutes and choose any of the six participating credit unions and banks to establish their RESP with $0. The user-friendly application is supported in five languages (English, French, Spanish, Mandarin and Punjabi).

From what I can read the SmartSaver looks to be very helpful for lower-income families, that Banks will overlook (in terms of RESP clients).

SmartSAVER makes it easier for you to start an RESP and receive the Canada Learning Bond by only working with RESP providers who provide the most flexible kind of plan: an individual RESP that has:  No account set-up, enrolment or annual fee; and No minimum contribution requirement.

Graduates Moving
A Post-Secondary Program Gives Kids Options in Life.

The service helps lower-income families with kids  have access to the CLB funds available to them and they don’t have to make any deposits. I like this idea. If the families could spare $10 a pay to put money into this, there would be a great deal more money available, to allow their kids to go to post-secondary schooling or not. If the family is unable to put any money into the account, they will continue to accumulate funds, from the CLB.

The program has been running as a pilot in Toronto, so this is an expansion on that initial start up project. Many interesting things were learned from that program including the fact that many bank branches and their representatives were not even aware of the CLB (I can attest to that problem, I ran into it myself at my local TD Branch).

I note there are no claims about growth and any of that, simply a statement that the program is to help folks set up RESPs to get access to the CLB (and any other funds that are available to lower-income families). My wife tried out the interface and was impressed with how it all worked as well (as I said we already have RESPs, and I don’t think this program is aimed at me).

My Opinion of the Program

This looks to me like a good program, and it will help many more folks get the funding they need to empower their kids, and give them more options in life.

BCM Caveat: with this (and all financial programs)  it is important to read the Terms and Conditions on the web site, always make informed financial decisions.

Feel Free to Comment

  1. BCM, I know the USofC have received bad rep over the years but they allowed both of my children to receive 4 years of college education debt free (living at home) with us depositing just $35/month(Baby bonus amount at the time 1986 to 2002) from birth to 16 years of age. Our children received >$20,000 each in total over the 4 yrs which paid their tuition & books plus a bit extra. This money was also part of the Fed’s 20% of our contributions which came along later on. The down side is that if I kids did not go to post secondary we would have only received the principal-$800(sign up+ annual fees) but our children did go and they benefited from other kids that left money in the fund (Classic). I know the plans have changed now but it was like taking out insurance on our children’s education. With the Feds providing the $35 BB + the 20% basically our children received a free education from the federal Government. In vesting the baby bonus in our children’s education was the smartest thing we did. I wish more parents would do this to release their children of the financial burden of a higher education. I know that $20,000 is at the low end of the cost of a University degree but if the child lives at home this can go a long way for a lower income child to receive the education that will provide a leg up for them to better their financial future. My $0.05 worth.

    1. @Lawrence, those programs had their time and I went to school with more than 1 friend who benefited from those programs, but there are so many more better ways to set up an education savings plan, I think USofC isn’t really relevant.

      And other commenters have pointed out, many folks are leaving their kids to pay for their own education, not what I did, but that is another option too.

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Verified by MonsterInsights