Understanding RESPs
C.S.T. Consultants Inc.
Planning your child’s education
Table of Contents
Canadian Scholarship Trust Foundation ........................................ 1
Who we are ...........................................................................................1
Our history ............................................................................................1
Helping your child succeed.........................................................................1
Our mission ...........................................................................................1
Over 55 years of milestones and memories .....................................................2
RESPs made easy ....................................................................................3
Why should you open an RESP? ....................................................................3
The 3 easy steps to getting an RESP .............................................................3
STEP 1: Understand the facts ........................................................... 4
Fact: A post-secondary education can enhance your child’s success . ......................4
Fact: It could cost $165,000 to send your child to university by 2034 .....................4
Fact: Saving early is in your best interest .......................................................5
Fact: You can avoid the burden of debt .........................................................5
Fact: Access $7,200 or more in government grants for your child’s RESP .................6
Fact: Saving is more affordable than you think ................................................ 6
STEP 2: Learn about the CST Plans .................................................. 7
Let the CST Advantage
®
give you peace of mind ...............................................7
Number of Plans .....................................................................................7
Assets under management ........................................................................7
Learning about the CST Plans .....................................................................8
CST Group Savings Plan 2001 .....................................................................9
Here’s how the Group Plan works ................................................................9
Our investment approach ........................................................................ 10
Our portfolio managers .......................................................................... 10
The value of long-term savings ................................................................. 10
STEP 3: Get started ........................................................................... 11
Comparing RESPs — Make the educated choice .............................................. 11
CST Group Savings Plan comparative questions checklist .............................. 11
Frequently Asked Questions .......................................................... 12
1
Canadian Scholarship Trust Foundation
Who we are
Your child is a reection of everything you value and
everything you believe in. You want the best for your
child. That’s why the gift of education is one of the
greatest investments you can make. It is the aim of the
Canadian Scholarship Trust Foundation to help you and
your child transform dreams into reality through the
power of education. We offer safe, solid, long-term
RESP solutions that give you the peace of mind that
comes with knowing that when your child will be ready
to pursue higher learning, you’ll be ready to help pay
for it.
Our history
The Canadian Scholarship Trust Foundation began as
a group of like-minded individuals who shared one
common vision — that all Canadian children should
have the nancial resources to pursue post-secondary
education. Their vision was a reection of their
deepest and most cherished beliefs; that education and
knowledge enrich the human experience. The founders
transformed this ideology into CST Plans — where
disciplined savings and smart investing begin.
As the distributor and investment manager of the
Canadian Scholarship Trust Plans, CST Consultants Inc.
(CST) is a wholly-owned subsidiary of the Canadian
Scholarship Trust Foundation. At CST, we have the
experience and expertise to help families like yours
develop education savings strategies.
Helping your child succeed
The Foundation has lobbied the Canadian government
for tax law changes that benet families saving for
their child’s post-secondary education
The Foundation was instrumental in lobbying the
Canadian government for the introduction of the
Canada Education Savings Grant (CESG)
The Foundation has over 55 years of experience
providing education savings solutions to families
across Canada
CST Plans have over $4.2 billion in assets and have
paid out almost $4 billion to Canadian families
1
Stable, low-risk approach to investing
The Foundation is one of Canada’s largest and oldest
group RESP providers
CST focuses solely on education savings — it’s all we
care about, and all that we do
Our mission
To advocate, develop, deliver and support
solutions that will enable every Canadian resident
to have sufcient nancial resources to pursue
post-secondary education.
START SAVING for higher
education and access up to
$7,200 in government grants!
2
1 The Canadian Scholarship Trust Foundation Annual Report 2015
2 Everyone is eligible for the basic CESG which matches 20% of the rst $2,500 you contribute to your child’s RESP each year up to lifetime
maximum of $7,200.
2
Over 55 years of milestones and memories
The Foundation has been a key player in the history and evolution of education savings in Canada,
pioneering the concept of an RESP and lobbying governments for tax incentives and grants.
View our videos at www.cst.org/clientvoice to hear from
some of the students and families who have beneted by
saving with CST.
Peter Wright brings
together a distinguished
board of directors,
establishes the non-profit
Canadian Scholarship Trust
Foundation and becomes
its first President.
There is very little
marketing and sales.
Sales are mostly by
word of mouth. Peter
Wright: “We have not
embarked on any program of advertising,
because we have felt that this could lead
to a misunderstanding of the purpose of
the Plan and to a withdrawal of the very
kind of support it now deserves and
receives from the mass media.”
1960
1970
1980
1960
1963
We propose a change to the Income Tax
Act to tax interest payments from the
Canadian Scholarship Trust Plan in the
hands of the students, and begin a
dialogue with the Government of Canada.
We launch our Individual and Family
Savings Plans, allowing families to take
advantage of changes made in the
Income Tax Act that year.
We expand the plans to include
two-year programs at colleges and
other institutions.
1961
We open for business
with a savings plan
designed to save for
university.
We celebrate:
• 30 years
• approximately 250,000 subscribers
• over $200 million in payments
March 31:
Joseph Potts
opens the first
Canadian
Scholarship Trust Plans for his family.
“In 1960, I was a young solicitor with
five children. I knew that I would
have a tremendous financial problem
if they all went through university at
the same time. All five went to
university and four completed their
degrees. The CST Plan was one of the
best investments I have made.”
1972
1978
1984
The change to the Income Tax Act is
approved: subscribers no longer have to
pay tax on interest payments — students
pay the tax at a much lower rate and
Canada introduces the registered
education savings plan (RESP). We make
our first education assistance payments
to 81 students.
1980
We celebrate:
20 years
80,000 subscribers
We launch
C.S.T. Consultants
Inc. to market
and administer
our plans.
over $20 million
in payments to
more than
10,000 students
1985
1988
We introduce a new logo.
1965
Overwhelmed by over 13,000 referrals
from existing subscribers, we hire a
company to take over enrolment work.
1969
1990
2000
2010
1990
We celebrate:
50 years
over $2.2 billion in payments
almost $3 billion in assets under
management
2010
2011
We update our logo.
2002
Canada introduces the Canada
Education Savings Grant.
1998
Government introduces three new grants:
Canada Learning Bond
Additional Canada Education
Savings Grant
Alberta Centennial Education
Savings Plan
2005
2007
1997
We lobby the federal and Alberta
governments to create more grant
programs. John Kearns, President and
CEO, Canadian Scholarship Trust
Foundation: “We believe our role as
advocate is an integral part of our
responsibility to help ensure access
to post-secondary education is
possible for everyone.
2004
William Balkwill, a 97-year old
subscriber, sends a photo of himself
with his granddaughter, Vanessa, and
his three greatgrandchildren, Matthew,
Johnathan and Olivia — all beneficiaries
of the CST Plans he invests in.
“The CST organization has proven to be
a very worthwhile investment in my
family’s education, and I encourage
others to consider using CST as a
vehicle to invest in our future.”
2009
We update our logo.
We encouraged the Saskatchewan
government to create a grant program.
2013
• B.C. Training and Education
Savings Grant introduced
Alberta Centennnial Education
Savings Plan closes
Over $4.2 billion in assets under management
2015
Saskatchewan Advantage Grant for
Education Savings introduced.
2014
The Quebec government introduces the
Quebec Education Savings Incentive.
We introduce
the Peter Wright
Graduate Award for $5,000, and later
expand the program to include four
other awards:
Arthur Pigott Award
Rowland Lloyd Award
• Gladys Neale Award
Kenneth Le M. Carter Award
The first Peter Wright Graduate Award
winner is Peter Marks, a 24-year old
medical student attending the
University of Toronto.
RESPs made easy
A Registered Education Savings Plan (RESP) is an
investment vehicle that allows contributors such as
parents, grandparents, friends and other relatives to
save for a child’s post-secondary education.
Why should you open an RESP?
Having an RESP enables you to:
Receive federal government grants
Receive provincial government grants
(where applicable)
Grow income on a tax-deferred basis
Have peace of mind knowing that money is there to
help fund your child’s education
The 3 easy steps to getting an RESP
STEP 1: Understand the facts
STEP 2: Learn about the CST Plans
STEP 3: Get started
DID YOU KNOW?
In 2014, Canadians held
$44.4 billion in their RESPs.
1
I want to be sure my
child’s education savings
are safe and not at risk to
market volatility.
I want to know that
whatever education
program my child
chooses, it will be
covered by their RESP.
2
1 Employment and Social Development Canada CESP Annual Statistical Review 2014
2 Eligible programs subject to government guidelines.
3
4
STEP 1: Understand the facts
Your child’s RESP is only three
steps away
With a household to run and children to raise,
it can be hard to nd time to plan your child’s
post-secondary education. But saving is the most
effective way to ensure that the nancial resources are
there when your child needs them, and that your kids
can graduate with little to no burden of debt.
At CST, we understand that time is important to
you. That’s why we’ve simplied the process for you
into three easy steps. By following our step-by-step
suggestions, getting started on your child’s RESP is as
easy as 1, 2, 3.
Fact: A post-secondary education
can enhance your child’s success.
Numbers don’t lie. More than ever, the job market
requires higher learning. At the same time, the cost of
education is dramatically on the rise.
University graduates earn on the average 50%
more than other full-time workers who do not have a
university degree.
1
3 out of 4 new jobs require a post-secondary
education.
2
Fact: It could cost $165,000 to send
your child to university by2034.
How much does higher learning cost?
To send your child to university, you’ll need about
$87,000 for tuition (home), and almost double that for
room and board (away). However, you can open an RESP
from CST for less than $10/month
4
to start growing your
money tax free in the Plan.
1 Universities Canada, Back to School Quick Facts, August 2015. 2 Looking-Ahead: A 10-Year Outlook for the Canadian Labour Market (2008-2017),
Human Resources and Skills Development Canada. 3 Projected tuition costs of a 4 year university program are based on the annual average cost
of tuition across Canada for the previous school year and an assumed average annual increase of 3.8%. Room and board are based on typical costs
for residence with an average annual increase of 2.4%. Projection includes the cost of entertainment, transportation and books adjusted using
an annual ination rate of 2%. Source: Statistics Canada 2015 and university websites. 4 Minimum monthly contributions for a Group Plan are the
greater of $9.50 or 1/10th of a unit.
This chart shows you the estimated cost
of a 4-year university program in 2034.
3
$150,000
$175,000
$125,000
$100,000
$75,000
$50,000
$25,000
$0
Home Away
5
Illustration only
Not intended to show future values.
Investment returns and actual future values
cannot be predicted or guaranteed.
DID YOU KNOW?
You can contribute up to a
lifetime maximum of $50,000
per child.
Investing an additional $250 to
your RESP every year for 17 years
could increase your savings by
$7,070.
1,2,3,4
Fact: Saving early is in your
bestinterest.
The earlier you start saving for your child’s education,
the more your savings can benet from the power of
compounding. If you start investing $210 every month
for your newborn, their RESP could be worth as much as
$23,764 more than if you start when your child is ve.
Fact: You can avoid the burden
ofdebt.
Saving or borrowing — which choice should you make
so that you can send your children to school? With
a few simple projections the ideal choice becomes
clear. Based on the example below, if you borrow an
amount equivalent to the value of your RESP, your
loan repayments would be more than your RESP
contributions. Borrowing doesn’t just cost more in the
long run, it also puts the burden of debt on your child.
CST Plan compared to student
loan program
$70,329
$70,329
$50,650
CST Plan
GSP 2001
(Newborn)
Student Loan
$37,295
$120,979
Grant
2
Loan Interest
5
Income, Attrition + SCR
3
Student Loan
CST Plan GSP 2001
Total Value
1,2,3,4
$12,289
$6,908
1 Principal: a subscriber’s accumulated contributions less sales charges, optional insurance premiums (if applicable) and account maintenance
fees. 2 Grant is calculated at 20% of contributions up to the $7,200 lifetime maximum. 3 Income on grant is calculated using an annual average
rate of return of 4%. 4 Income on Principal is calculated based on an average annual rate of return of 4%. Attrition is part of the Group Plan bonus
and is allocated across all scheduled education assistance payments (EAPs). It represents income not collected by beneciaries before the end of
their benet period. This amount is based on historical rates of participation with an assumed rate of return of 4% over the lifetime of the plan. It
also includes the minimum Sales Charge Refund (SCR). Sales Charges are deducted from your contributions when you rst start your plan. Students
who collect all four EAPs receive a refund of at least 50% of these charges. 5 The repayment schedule is based on a 15 year timeline in accordance
with most student loan plans beginning six months after graduation. For the purposed of this illustration, interest has been calculated using prime
(2.7% )+ 5.3% totalling 8%.
$21,121
$7,200
$34,172
$16,578
$7,200
$27,890
$10,760
$6,048
$38,222
Newborn
(Saving for 17 years)
Age 2
(Saving for 15 years)
Age 5
(Saving for 12 years)
Total RESP
$70,329
Total RESP
$60,924
Total RESP
$46,565
CESG
2
Income, Attrition + SCR
4
Principal
1
CESG investment income
3
$3,786
$2,974
$6 048
$1,867
Illustration only
6
Fact: Access $7,200 or more in government grants for your child’s RESP.
Enhance your disciplined education savings strategy with the benet of government grants. The sooner you start a
Registered Education Savings Plan (RESP) for your child, the sooner you will be rewarded by the Canadian government
for planning and thinking ahead.
TYPE OF GRANT EXPLANATION
Canada Education
Savings Grant (CESG)
Everyone is eligible for the basic CESG which matches 20% of the rst $2,500 you contribute to your
child’s RESP each year up to lifetime maximum of $7,200.
Additional CESG (ACESG)
If your family has an annual net income below $90,563 your child may be entitled to an additional
grant on the rst $500 you contribute to his/her RESP each year. This extra 10% or 20% grant is
referred to as the ACESG.
Canada Learning Bond
(CLB)
If your family receives the National Child Benet Supplement, your child may receive $500 in the
rst year and an additional $100 per year for each year you qualify until your child turns 15 – this
could add up to an additional $2,000 in grants towards your child’s RESP.
Quebec Education
Savings Incentive (QESI)
Offered by the government of Quebec, QESI provides 10% on the rst $2,500 contributed annually to
an RESP by residents of Quebec up to a lifetime maximum of $3,600.
Additional QESI
If you are a resident of Quebec and your family’s income falls below a certain level, your child
might qualify for another 5% - 10% on the rst $500 contributed each year to your child’s RESP.
Saskatchewan Advantage
Grant for Education
Savings (SAGES)
Offered by the government of Saskatchewan, SAGES provides 10% of the rst $2,500 contributed
annually to an RESP by residents of Saskatchewan to a lifetime maximum of $4,500.
British Columbia Training
and Education Savings
Grant (BCTESG)
Offered by the government of British Columbia, the BCTESG is a one-time $1,200 grant available
to BC resident children born on or after January 1st, 2006. Children are eligible for the BCTESG on
their sixth birthday. You have until the day before your child’s ninth birthday to apply.
For details see government websites or our Prospectus at www.cst.org.
Fact: Saving is more affordable than you think.
With one or more children in your household, you may feel that your expenses are stretched too thin to put aside
money for education. Making ends meet can be challenging, but did you know that you can start a Group Plan
for less than $10/month?
1
And that’s not all, there are additional sources of funding that you can access to start
contributing now to your child’s RESP and enjoy the benets of government grants and compound earnings.
1 Minimum monthly contributions are the greater of $9.50 or 1/10
th
of a unit.
STEP 2: Learn about the CST Plans
Let The CST Advantage
®
give you
peace of mind
Principal protection: Your RESP principal is invested in
stable and secure xed-income government and nancial
institution bonds. The principal will be returned to you
at maturity.
Earning power you need: The income your principal
earns is invested in a mix of Canadian equities, U.S.
Exchange Traded Funds (ETFs) and investment-grade
corporate bonds to make sure your investment earns
competitive returns over the life of the plan.
Hassle-free saving: You don’t have to constantly
monitor performance. Just decide how much you want
to contribute and we’ll take care of the rest.
Flexible study options: CST Plans allow your child to
pursue and fund their full or part-time studies including
changing programs or transferring schools in Canada
or abroad:
Universities
Community colleges
Trade schools
Vocational schools
Technical schools
Religious schools
CEGEPs
Distance learning
Correspondence courses
Number of plans
(N
umber of plans)
539,429
*As of October 31, 2014
0
100000
200000
300000
400000
500000
600000
1960 1970 1980 1990 2000 2010 2015
As of October 31, 2015
1
As of October 31, 2015
1
1 The Canadian Scholarship Trust Foundation Annual Report 2015
7
Assets under management
($ billions)
28%
Growth over the
last five years
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
3.3
3.5
3.8
2011 2012
3.9
2013
4.1
2014
2010
4.5
4.2
2015
8
HOW IT WORKS
PLAN BENEFITS
Available for children of any age
Flexible contribution schedule
Family Savings Plan can be used towards the post-
secondary education of multiple beneciaries so long as
they are siblings and under age 21
Individual Savings Plan can be used towards the post-
secondary education of any beneciary, including self
Access EAPs any time after enrolment in eligible studies
Flexible study options
Control timing of payouts
Option to transfer income to the subscriber’s Registered
Retirement Savings Plan (RRSP) or withdraw Accumulated
Income Payments (AIP) or transfer income to a Registered
Disability Savings Plan (RDSP)
5
Family and Individual Savings Plans are
not eligible for the Group Plan Bonus,
Discretionary donation or sales charge refund
Learning about the CST Plans
HOW IT WORKS PLAN BENEFITS
Available for children under the age of 13
Pooled education savings plan
Fixed contribution schedule with several payment options
Longer-term investment horizon
After the plan matures and your child enrols in eligible
studies, they will receive Education Assistance Payments
(EAPs) for up to 4 years of studies
Disciplined savings
Principal protection
Group Plan Bonus
2
— Students receive a bonus on top of their
investment income after maturity. It’s a benet you only get
from our group RESP.
Discretionary Foundation donation
3
— The Foundation has
made a donation every year since 1987. These donations have
amounted to over $70 million, including $4 million in 2015.
4
A minimum of 50% of the sales charges will be refunded.
Access to EAPs in the rst year of education
Flexible study options
Option to transfer to a Family or Individual Savings Plan
(conditions apply) which allows the option to transfer income
to the subscriber’s Registered Retirement Savings Plan (RRSP)
or withdraw Accumulated Income Payments (AIP) or transfer
income to a Registered Disability Savings Plan (RDSP)
5
Low risk
Stable returns
Group Savings Plan 2001
Most of our clients nd the Group Savings Plan to be the preferred savings solution, which offers bonuses, a sales
charge refund, disciplined contribution schedule and expected higher returns versus our other RESP plans.
1
Family and Individual Savings Plan
If you prefer a less disciplined contribution schedule or if your child pursues a shorter study program or decides to
not pursue post-secondary education, you have the option of enrolling in or transferring to a Family or Individual
Savings Plan.
1 The 10 year rates of return (net of fees) for the Group Savings Plan 2001, Family and Individual Savings Plans as of October 31, 2015 are 3.4%,
2.0% and 1.9% respectively. Past performance is not indicative of future results. Investment returns cannot be predicted or guaranteed. 2 The
Canadian Scholarship Trust Foundation annually allocates the General Fund balance as a Group Plan Bonus to eligible beneciaries across all
scheduled Education Assistance Payments. Refer to the Prospectus for additional information. 3 Discretionary payments are not guaranteed. You
must not count on receiving a discretionary payment. The Foundation decides if it will make a payment in any year and how much that payment
will be. 4 The Canadian Scholarship Trust Foundation Annual Report 2015. 5 Government conditions apply.
Individual/Family Savings Plan
Group Savings Plan 2001
+
+
1st
EAP
3
EAP
3
Principal
refund
Principal
refund
Transfer
to RDSP
7
Withdraw
as Income
7
Transfer
to RRSP
7
Principal
refund
2nd
EAP
3
3rd
EAP
3
4th
EAP
3
1/4
SCR
4
1/4
SCR
4
1/4
SCR
4
1/4
SCR
4
+
+
+
+
+
+
+
+
Your child pursues
post-secondary education
Your child does not pursue
post-secondary education
Withdraw as a single education
assistance payment or several
payments as per your child’s
needs
Funds can be used from the time of transfer up until the
36
th
year of the plan
Your child becomes a qualified
student four installments,
one per year
Funds can be used from the time
of maturity (age 17/18) up until
the 36
th
year of the plan
Prior to maturity transfer to:
• Any child under 18 years old
To a sibling under 21 years old
• The Individual/Family Savings Plan
Stay in the Group Savings Plan or
transfer to the Individual/Family
Savings Plan
6
Your principal
5
is refunded tax-free.
Government Grants
Income on Grants
Income on Principal
Our Group Plan Bonus
1
Foundation
Discretionary Donation
2
Option 1
Option 2
Option 3
+/or
+/or
+/or
CST Group Savings Plan 2001
Our group savings plan is a pooled savings plan that combines benets not available in any non-group RESP Plan.
Here’s how the Group Plan works
At maturity
When your plan matures, it’s time to decide the
payout option best suited for your child’s choice of
post-secondary education.
1 The Canadian Scholarship Trust Foundation annually allocates the General Fund balance as a Group Plan Bonus to eligible beneciaries across
all scheduled Education Assistance Payments. Refer to the Prospectus for additional information. 2 Discretionary payments are not guaranteed.
You must not count on receiving a discretionary payment. The Foundation decides if it will make a payment in any year and how much that
payment will be. 3 Education Assistance Payment 4 We return at least 50% of your sales charge, as long as you make all your Contributions and your
Beneciary qualies and receives all four EAPs. 5 Principal: a subscriber’s accumulated contributions less sales charges and account maintenance
fees. 6 Conditions apply. Transfer to Individual/Family Savings Plan will lead to loss of rights as a Group Savings Plan 2001 subscriber. 7 Additional
requirements apply. If principal is withdrawn prior to the Beneciary enrolling in eligible studies, government grants will be forfeited and repaid to
the Government.
If your child wants to attend school for two years or
less, is not pursuing post-secondary education or you
wish to control the timing of the payout, we recommend
transferring to the Individual/Family Savings Plan.
9
10
Our investment approach
We focus on long-term value by giving you the safety
of principal protection combined with the earning
power you need.
Principal protection: Your RESP principal is invested
in stable and secure xed-income government and
nancial institution bonds. The principal will be
returned to you at maturity.
Earning power you need: The income your principal
earns is invested in a mix of Canadian equities, U.S.
Exchange Traded Funds (ETFs) and investment-grade
corporate bonds to make sure your investment earns
competitive returns over the life of the plan.
Our portfolio managers
Our portfolio managers are among the top institutional
money managers
in Canada*:
• BlackRock Asset Management Canada Limited
• BMO Asset Management Inc.
• Canso Investment Counsel Ltd.
• CGOV Asset Management
• CIBC Asset Management Inc.
• Greystone Managed Investments Inc.
• Sionna Investment Managers Inc.
• TD Asset Management Inc.
4.7%
Effective rate of return over
the total life of the plan.
1
Illustration only
CANADIAN
GOVERNMENT
AND FINANCIAL
INSTITUTION
BONDS
CANADIAN EQUITIES
U.S. ETFs
I
N
C
O
M
E
P
O
R
T
I
O
N
P
R
I
N
C
I
P
A
L
P
O
R
T
I
O
N
C
A
N
A
D
I
A
N
E
Q
U
I
T
I
E
S
C
O
R
P
O
R
A
T
E
B
O
N
D
S
The value of long-term savings
Beneciaries of the CST Group Savings Plan 2001 received a 4.7% effective rate of return.
1
Bank:
The Royal Bank of Canada
Where your money is deposited
Trustee:
RBC Investor Services Trust
Where your money is held in trust
Sponsor:
Canadian Scholarship Trust Foundation
A not-for-profit Foundation since 1960
Investment Fund Manager and Distributor:
C.S.T. Consultants Inc.
Wholly-owned by the Foundation
Our asset class policy
1 The effective rate of return calculated as the sum of EAPs for the 2012 cohort of
the Group Savings Plan 2001, assuming all are paid to the qualied student, the
sales charge refund where applicable and the maturity refund divided by the total
contribution for a one unit plan for a child under the age of one. Past performance is
not indicative of future results.
*Top 40 Money Managers, Benets Canada, Nov. 2015
11
STEP 3: Get started
Comparing RESPs — Make the educated choice
Like any major nancial decision, you should compare different RESP providers to determine which is the best one
for you and your child. Use this checklist as a guide when evaluating RESPs. Asking the right questions will lead you
to the right answers.
My parents had the foresight to subscribe to a CST Plan and that’s how
I was able to afford a university education. When I had my own kids,
I didn’t hesitate to do the same for each one of them.
— Mike Rand, Toronto, ON
Principal protection
Is my principal protected?
q
How much of my money could I lose in the
worst case scenario?
q
Fees and administration
What are the total costs over the life of the
Plan? Be sure to ask about:
• Commissions and trailing commissions
• Management Expense Ratios (MERs)
• Transfer fees
Administration and sales charge
q
What is the minimum amount I need to
invest to open an education savings plan?
q
Can my child receive Education Assistance
Payments in their rst year of study?
q
Additional funds
Will I receive any bonuses to my plan aside
from government grants?
q
Will I receive any additional donations to
my plan aside from government grants?
q
Is there a sales charge refund?
q
Flexibility
Can this education savings plan be
transferred to any other child? If so, up to
what age?
q
How exible is the choice of schools
and academic programs covered by this
education savings plan?
q
CST Group Savings Plan comparative questions checklist
12
Frequently asked questions
Q: What is the minimum amount that I need to open a
CST RESP?
A: The minimum amount you need to invest in the
CST Group Savings Plan 2001 is the greater of $9.50
or 1/10
th
of a unit. The minimum investment for
the Individual and Family Savings Plans is $150
unless the plan is being opened to only collect the
Canada Learning Bond, in which case the minimum
investment is waived.
Q: Who can open a Canadian Scholarship Trust Plan for
a child?
A: Anyone! Parents, grandparents, other relatives, even
a friend of the family.
Q: What are the tax advantages of an RESP?
A: An RESP offers you three distinct tax advantages:
a. The investment income earned on your principal
grows tax-free within the plan.
b. The government grants also earn tax-free
investment income within the plan.
c. Payments from the plan are taxable in your child’s
name, not yours. Since students tend to have little
or no annual income, little or no tax is payable.
Q: Why shouldn’t I open a Tax-Free Savings Account
(TFSA) instead?
A: Tax-Free Savings Accounts are a great way to save
for lots of things, but only RESPs are eligible for
government grants. For example, through an RESP
you can access up to $7,200 in federal grants.
Q: How is the money invested?
A: Your principal is invested in:
Government and Financial Institution bonds
Cash and treasury bills
Your income may be invested in a mix of:
Fixed Income Investments as above
Canadian equities
U.S. Exchange Traded Funds (ETFs)
Investment-grade corporate bonds
This provides principal protection while offering
the potential to enhance long-term investment
performance.
Q: Does my RESP require a lot of time to manage?
A: Absolutely not! You only have to make the one-time
decision to start a plan, invest regularly, and we’ll
do the rest. We manage your funds for you and send
you an annual statement of your account. We arrange
automatic contributions from your bank account so
that you never have to worry about it.
Q: How do I apply for grants?
A: We make it easy to apply for government grants.
When you open your plan, simply provide Social
Insurance Numbers (SINs) for you and the child you’re
opening a plan for and your Sales Representative will
complete the necessary forms with you. We’ll submit
the paperwork to the government and apply for any
grants you qualify for. Any grants received will be
deposited directly into your child’s plan.
13
Q: Is it necessary to begin post-secondary education
immediately after high school?
A: No. If your child wishes to postpone starting
post-secondary education for a year or so, simply
notify the Canadian Scholarship Trust Foundation
in writing and the necessary adjustments will be
made. The time limit for collecting all EAPs is by
the 36
th
year from when the plan was opened.
Q: What types of post-secondary schools and
programs apply?
A: We recognize any program that qualies under
the Income Tax Act (Canada), and institutions that
range from community colleges and universities to
vocational, technical, trade and religious schools.
On top of that, we’re evaluating new schools
and programs all the time. Distance learning and
correspondence courses are also eligible. For full-
time programs at eligible Canadian schools this means
a program of at least 3 consecutive weeks in duration
with at least ten hours of instruction each week.
For eligible schools outside of Canada, the program
must be at least 13 weeks in duration or for students
enrolled full-time at a university, the program must
be at least 3 weeks in duration. For part-time studies,
the program must be at least 3 consecutive weeks
for at least 12 hours per month at eligible Canadian
schools or 13 weeks for schools outside of Canada.
Q: What happens if my child does not pursue post-
secondary education?
A: You have several options:
Transfer the plan to another eligible beneciary
If your child is over the age of 21 and the plan has
been open for more than 10 years, you may transfer
up to $50,000 of income to your RRSP, spousal RRSP
or RDSP tax-free, provided you have sufcient
contribution room. Alternatively, you can simply
withdraw the income and pay tax on it at your
marginal tax rate, plus an additional tax of 20%.
Government grants will need to be returned to the
government. Remember, your principal will always be
returned to you tax free.
Q: What kind of service can I expect from CST?
A: We’ll send you a detailed statement of all the
activity in your plan once a year. You can also view
information about your account online any time by
registering on the secure CST Self-Service Website.
We will also provide you with access to our customer
care department. And, of course, your CST Sales
Representative is always there to help you.
Q: How will I get information on my plan?
A: We will send you a detail statement of all the activity
in your plan once a year. You can access information
about your account online any time by registering for
secure access at www.cst.org. If you have questions
about your plan or plan activity, you can contact
your CST Sales Representative or our Customer Care
Centre (1.877.333.7377).
I do not believe my undergraduate education would
have evolved in the same way without the Canadian
Scholarship Trust Plan. The invaluable academic and
non-academic experiences that I gained with the help
of CST have positioned me to pursue my ambitions.
Jamie Huckaby, Lethbridge, AB
C.S.T. Consultants Inc.
Canadian Scholarship Trust Foundation
Canadian Scholarship Trust Plan is only sold by Prospectus. Investors should read the Prospectus before making an investment decision because it
includes important detailed information. You can get copies of the Prospectus from www.cst.org or by calling 1.877.333.RESP(7377).
© C.S.T. Consultants Inc., 2016. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any
form or by any means, without the prior written permission of C.S.T. Consultants Inc.
Discover The CST Advantage
®
.
Your child’s education plan
deserves an experienced RESP provider.
For more information, please call your CST Sales Representative.
2005E ROC(2016-02)