Growing family
Children change your tax situation as much as your budget. Both benefits below are income-tested.
Who it is forParents and parents-to-be with children under 18.
- 01
Lower AFNI, raise the child benefit
The Canada Child Benefit is reduced against adjusted family net income. An RRSP contribution lowers AFNI, so it buys a tax refund and a larger benefit at the same time.
Do thisModel a contribution that pulls you under the $81,222 second threshold if you are just above it.
CCB optimizerFamily - 02
Claim the RESP grant every single year
The first $2,500 a year attracts a 20% federal grant — $500 of free money, to a $7,200 lifetime maximum per child.
Do thisContribute $208 a month per child. Unused grant room carries forward only one year at a time.
RESP and CESGFamily - 03
Size life insurance with DIME, not with a guess
Debt, income replacement, mortgage payoff and education costs. Subtract what you already have through work.
Do thisBuy term to the year your youngest finishes school, not whole life.
Life insurance needFamily - 04
Rebuild the budget around child care
Child care is often the second-largest line in a family budget after housing, and it lands before the benefit payments arrive.
Do thisTreat the CCB as income, and child care as a fixed cost.
Budget plannerIncome & tax - 05
Re-run the account order
With children, the RESP grant usually outranks a TFSA contribution.
Do thisRe-check the ranking each time household income changes materially.
Account optimizerSaving & investing
Two federal programs, one income test
The CCB and the additional CESG both key off family income, which means one RRSP contribution can move both. Model them together rather than one at a time.
Run it on your own numbersCCB optimizerHow an RRSP contribution lowers AFNI and raises your child benefit.