The Government of Alberta has put forward legislation that will cancel the Alberta Centennial Educations Savings grant (ACES) that pays an initial $500 into an RESP when parents open one on behalf of their child. ACES was introduced by Premier Klein in 2005 to support Albertans in saving for their child’s education. This program was initially intended to support all Albertans to save. However, the government is cancelling it due to low enrollment rates by people living on low incomes.
The Role of ACES in promoting education savings
While the ACES grant and RESPs grow in popularity every year, they still aren’t very well known. Many parents are misinformed about RESPs and don’t realize that they don’t have to contribute any of their own money to access the government grants and bonds. Promotion and education is needed. The grant on its own is not enough if parents don’t realize that it exists and what the benefits are. To this end, Momentum has worked with over 4,000 low income families, resulting in over 1,200 RESP accounts being opened. And those are only the ones that we know about!
Why does Momentum care about education savings?
Children with an education savings account in their name are up to six times more likely to finish high school and move on to post-secondary education. Momentum sees these education grants and RESPs as a two-generation approach to poverty reduction. 25% of children raised in poverty will remain in poverty throughout their life. Education is a tool to end this cycle.
Momentum will work with government and others over the coming weeks and months to ensure that ACES is kept at least for the benefit of low income Albertans. This will help to lessen the cost of a post-secondary education for people living on lower incomes.
Are there any other grants available for education savings?
Parents with children under 6 years old have until July 31st 2015 to apply for the ACES grant. The federal Canada Learning Bond – a bond especially for low-income families and matching federal money (Canada Education Savings Grant & Additional Canada Savings Grant) are unaffected by these changes.