Parenting

Best RESP Provider?

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  • Aug 19th, 2015 2:03 pm
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Newbie
Feb 11, 2010
47 posts

Best RESP Provider?

I plan on opening an acct for my kid. Just began researching recently. Any recommendations on best provider?

Thx!
78 replies
Newbie
Sep 1, 2006
35 posts
1 upvote
no different than opening a RRSP account..

you can use your local bank branch, an online broker, your full service broker or independent funds

of course lots of fine print if you buy into a fund or those mall kiosks companies. Read carefully the withdrawal rules when you need it and the annual management fees. No different than a mutual fund. MER rates can vary drastically and only eats into your investment incomes.
Sr. Member
Oct 7, 2011
833 posts
166 upvotes
Toronto
You can open a self directed account at most financial institutions, whereby you can choose to buy their mutual funds.
Sr. Member
Oct 7, 2011
833 posts
166 upvotes
Toronto
DrXenon wrote:
Nov 10th, 2011 6:23 pm
Speaking as someone who is in the Canadian Scholarship Trust plan and wishes he could get out
Oh no, you were one of those that got scammed. OP, do NOT buy into the Canadian Scholarship Trust.
[OP]
Newbie
Feb 11, 2010
47 posts
DrXenon wrote:
Nov 10th, 2011 6:23 pm
Speaking as someone who is in the Canadian Scholarship Trust plan and wishes he could get out, I would recommend this. Just open an RESP account at your bank and invest in a Couch Potato portfolio, biasing more and more to bonds as your kid approaches university age.
Cavegirl wrote:
Nov 10th, 2011 10:16 pm
Oh no, you were one of those that got scammed. OP, do NOT buy into the Canadian Scholarship Trust.

They've been calling me lately because I signed up for more info during the BabyTime show, but I don't know what they're about. What's so bad about them?
Deal Fanatic
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Dec 30, 2006
8728 posts
294 upvotes
Toronto
We are with CST and I do not see them as a scam at all.
Jr. Member
May 23, 2007
198 posts
78 upvotes
DrXenon wrote:
Nov 13th, 2011 11:57 am
Basically the management fees are a) high and b) front-loaded. At the moment, after 11 years, my management fees amount to 20% of my principal after we stupidly increased our contributions a year ago. If I want to get out or reduce my contributions, I forfeit the management fees. Also, the performance of the investments is about 60% of what I was getting in my other, self-directed investments. If the performance of the investments was good, I could see paying high management fees, but they are under performing because they take very little risk.

You are far better off with your bank and a passive ETF couch-potato-style portfolio that you rebalance every year to 18 months. Your management fees will be less than 1%, and your kid will have more money for school rather than buying new winches for the CST corporate yacht.
I'm looking to start an RESP for my new-born, and I was going to go with the CST. My understanding (based on their web site), is that they refund at least 50% of the 'enrolment fees' upon maturation... Are they separate from 'management fees' or different terms for the same thing?

Do you have any updates on your situation? Your post is making me a bit nervous, so I had better start researching other options, just in case...

Cheers,

DB.
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Dec 21, 2005
4716 posts
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Markham
DoeBoye wrote:
Mar 7th, 2012 2:58 pm
I'm looking to start an RESP for my new-born, and I was going to go with the CST. My understanding (based on their web site), is that they refund at least 50% of the 'enrolment fees' upon maturation... Are they separate from 'management fees' or different terms for the same thing?

Do you have any updates on your situation? Your post is making me a bit nervous, so I had better start researching other options, just in case...

Cheers,

DB.

Considering that the government provides a minimum $500 grant per year for each $2500 contributed, you could go to your local bank, open an RESP account, buy GICs and not have to worry about losing money or paying mgmt fees to companies like CST.
:idea: :) :lol: :razz: :D
Deal Addict
Mar 27, 2011
1281 posts
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Nowhere
DoeBoye wrote:
Mar 7th, 2012 2:58 pm
I'm looking to start an RESP for my new-born, and I was going to go with the CST. My understanding (based on their web site), is that they refund at least 50% of the 'enrolment fees' upon maturation... Are they separate from 'management fees' or different terms for the same thing?

Do you have any updates on your situation? Your post is making me a bit nervous, so I had better start researching other options, just in case...

Cheers,

DB.

Avoid these group providers that you find in malls like the plague. The management is just ridiculous.
Your best option is to open an RESP with your local bank or brokerage that way you can structure it how you want
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May 31, 2009
2623 posts
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dibksbgon wrote:
Mar 7th, 2012 3:46 pm
Avoid these group providers that you find in malls like the plague. The management is just ridiculous.
Your best option is to open an RESP with your local bank or brokerage that way you can structure it how you want

Correct.

Problem with the scholarship plans, as I see it are:

1. If you come into financial difficulty in say year 16 after 15 years of contributing. Hypothetical example, because it will happen to a few people. If you don't pay your contribution in year 16, you forfeit your plan, and lose all investment gains. The gains are then spread amongst the remaining contributers, and all you get back is your principal. So you lost the value gained from 15 yrs of contributing, as well as the compounding benefit.

2. If your kid doesn't go to university/college. It does happen. Then you don't get your investment gains once again, only principal.

I'd rather be safe than sorry. So with an RESP, I open a family plan, so any child I have can use it. Heck...chances are one of my kids will go to university, lol. I hope.
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Aug 30, 2006
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crownme wrote:
Nov 13th, 2011 4:59 pm
Don't forget the $500 Canada Learning Bond when you sign up with select providers...

http://www.canlearn.ca/eng/saving/clb/index.shtml
Is my child eligible for the Canada Learning Bond?

Your child is eligible to receive the Canada Learning Bond if:

he or she was born after December 31, 2003; and
you receive the National Child Benefit Supplement under the Canada Child Tax Benefit (also known as the family allowance).

http://www.canlearn.ca/eng/saving/clb/b ... -eng.shtml
?
shaka braddah!
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Dec 4, 2009
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dibksbgon wrote:
Mar 7th, 2012 3:46 pm
Avoid these group providers that you find in malls like the plague. The management is just ridiculous.
Your best option is to open an RESP with your local bank or brokerage that way you can structure it how you want

+1

And go with iTrade (Scotiabank), the only bank/brokerage I found that didn't charge a $50/yr account maintenance, which amounts to 10% of what the government provides. Right there, it's like a 2% management fee!
That's the end of my rant.
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