EAP or educational assistance payments are derived from RESPs, or registered education savings plans in Canada.
1. EAPs are computed from RESPs
Educational assistance payments will vary from plan to plan, depending on how much the subscriber has contributed to the plan before its maturation.
EAPs are designed to help with expenses related to the beneficiary’s post-secondary school expenses.
Canada Learning Bond (CLB) beneficiaries can receive payments in secondary school, as long as the modest-income family has registered to receive CLB payments in their RESP.
2. Fees will be deducted from the RESP
This is one thing that many people forget when they sign up for RESPs. When you contribute to your heritage education funds – RESP the amount that you give will be reduced because there are sales fees and other handling fees involves.
The financial institution or scholarship plan dealer should disclose these fees where you opened the RESP in the first place.
So before opening a RESP and making contributions, it is important that you first familiarize yourself with the different fees associated with maintaining a registered education savings plan.
Now if you feel that the fees are not to your liking, you can always go to another financial institution or company and check out their policies and fees, too.
Comparing fees is a good way to get better deals with RESPs, especially with scholarship plan dealers. On the other hand, you can always just approach a conventional bank or investment company for help with opening an RESP.
3. You can apply for a deferral of the first EAP
Deferrals of EAPs means the beneficiary may not be ready yet to begin post-secondary school training. When the payments begin to roll out, the balance is reduced and this is something that some parents may not like.
In order to qualify for a deferral, you must write a letter of appeal to the financial institution or scholarship plan company. What is usually offered is a deferral of a maximum of two years from the date of the maturation of the plan.
Take note that the institution offering the plan may not void it just because you asked for a deferral. RESPs are considered valid for up to 36 years after they have been opened by the primary subscriber.
4. CLB payments are not part of CESG payments
A beneficiary can qualify for both CESG and CLB, and in the process, the subscriber is able to amplify the annual contributions easily. On the first year of contribution, the Canadian government will pay up to $500 in CLB and $600 maximum for CESG payments.
The cumulative lifetime maximum for CLB beneficiaries is $2,000, while CESG beneficiaries can only receive a maximum aid of $7,200 no matter how many RESPs are opened in their name. In total, a beneficiary can enjoy additional aid of $9,200 if he or she qualifies for both CLB and CESG.
5. Primary caregivers can receive tax benefits.
The person caring for the beneficiary and is paying the contributions can be eligible for the Canada Child Tax Benefit or the CCTB.

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