Canada Life introducing RESP to group benefits plans

Canada Life Assurance Co. is introducing a self-directed registered education savings plan to help employers support their employees’ varying financial priorities.

Employers can add the RESP to their employee benefits plan at no addition cost, while plan members can choose either the family or individual plan, where they can contribute as much or as little as they want through payroll deduction, pre-authorized debit or online banking payment. Contributions are then placed into a fund designed to automatically lower the risk of potentially decreasing in value as students get closer to starting post-secondary education.

Read: Just 6% of Canadians cite retirement saving as top financial priority in 2019: survey

Employees are also prompted to access any applicable grants, including the Canada Education Savings Grant, which kicks in $1 for every $5 an employee contributes, or the Canada Learning Bond, which is aimed at low-income Canadians and provides a $500 initial grant to a maximum of $2,000, just for opening an RESP account.

“Tuition and student debt are only going to go up,” said Ryan Weiss, the insurer’s vice-president of product and experience for group customer, in a press release. “RESPs are without a doubt the best way to save for education, but many families who need it most are missing out on free education grant money, in part because they believe opening an RESP is a complex and daunting task. We’ve addressed this concern by making Canada Life’s RESP conveniently available through the employee’s workplace benefits and simplified the enrolment process with an online application.”

The RESP complements Canada Life’s student debt savings program, which helps employers support graduates in saving for retirement, even as they pay down student debt.

Read: How RBC is fitting debt payment into employees’ financial journeys