An alternative way to save for your kid's education.

A Scholarship Trust Fund is a form of a group or pooled savings plan

These funds generally have age restrictions as to when an account can be open for a child and an age limit for claiming scholarships. However, with the government relaxing many of the rules related to education savings plans, the Scholarship Trust Fund could appeal to some investors.

A key feature of Scholarship Trust Funds is that each individual’s contributions and the Federal Government’s portion are pooled and invested in government guaranteed investments. The savings can earn interest that compounds in a tax shelter. At the plan’s maturity, the accumulated funds or principal balance is returned to the contributor (subscriber), and the accumulated interest and Federal Grant is returned to the student, intended to assist with the expenses of a post-secondary education.

Although the Scholarship Trust Fund is designed to help students cover the cost of higher education, the government has relaxed the rules, whereby should the student not pursue post-secondary studies, the subscribers can receive their principal, interest, and interest earned on the Federal Grant, and pay any tax or penalties in return.

While the Scholarship Trust Fund is an option for education funding, GP Wealth does not provide this form of savings vehicle.