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  • Mar 11th, 2021 12:09 pm
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[OP]
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Feb 18, 2019
364 posts
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Toronto

Best RESP ?

Which bank or institution would you suggest for RESP? Which has the lowest fees?
43 replies
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May 11, 2014
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Whatever you do avoid group RESPs.

NEVER USE:
Knowledge First
Canadian Scholarship Trust Spark (CST Advantage)**
Global
Kaleido

Also avoid insurance company plans that utilize segregated funds like:

iA Diploma
Manulife Segregated Fund RESP

**NOTE CST Spark is CST's newest product with not as much contract issues. But after looking at the management of the fund, it is still fairly expensive, so I would still put this as not recommended. Additionally, we should not be supporting a company that is still selling the atrocious Advantage plan.
Last edited by xgbsSS on Mar 3rd, 2021 4:52 pm, edited 2 times in total.
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Oct 27, 2012
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You can use some brokerages too. I have our RESP with Questrade and there are no fees (assuming you meet the minimum balance throughout your accounts).
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Jan 4, 2007
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I use td for my kids resp
.basic aggresive couch potato for them. Set it and forget it
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Nov 11, 2010
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GTA
Open a Self Directed RESP account with any online brokerage. Most providers do not charge any account fees for RESP.

Depending on your investing philosophy, either purchase low MER ETFs or you can do a combination of ETFs and growth stocks, if you have the knowledge.
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Jan 3, 2013
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freakoutguy wrote: Open a Self Directed RESP account with any online brokerage. Most providers do not charge any account fees for RESP.

Depending on your investing philosophy, either purchase low MER ETFs or you can do a combination of ETFs and growth stocks, if you have the knowledge.
This. Its so easy.
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Jun 2, 2020
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Another thing - if you decide you want to do an RESP with a bank and want to go with a bank’s product make sure you’re buying the “self directed” product vs the “managed” product - as an example RBC has a target eduction fund which is a diversified portfolio of stocks and bonds which changes composition as you get closer to the target date. These have a series A and a series D - same holdings but one you buy yourself and another you allow the bank to buy for you for a MER of 1% extra.
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Dec 5, 2006
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speeeeee wrote: I use td for my kids resp
.basic aggresive couch potato for them. Set it and forget it
What's inside aggressive couch potato, there are a few models
Also how do you invest? Dollar average?

Thanks
Member
Mar 17, 2004
492 posts
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Whatever brokerage or financial institution you choose, just make sure they support all available RESP grants that you are eligible for in your province. I live in BC and am eligible for the BCTESG, $1200 per child. I found that only a handful of institutions will support it.
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Sep 2, 2009
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Basically just have VBAL in a self-directed account.

Wherever you do chose, just make sure they can receive the grants and automatically (some don't).
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Since OP is in Ontario, the provincial grants aren't an issue.

For those in BC, Virtual Brokers allows free ETF purchases and supports BCTESG.
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Nov 26, 2016
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xgbsSS wrote: Whatever you do avoid group RESPs.

NEVER USE:
Knowledge First
Canadian Scholarship Trust Spark
Global
Kaleido

Also avoid insurance company plans that utilize segregated funds like:

iA Diploma
Manulife Segregated Fund RESP
What is the downside of CST Spark? I was considering those guys.. could you please elaborate a bit?

And what's your recommendation if not these guys?
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mysttz wrote: What is the downside of CST Spark? I was considering those guys.. could you please elaborate a bit?

And what's your recommendation if not these guys?
Actually I assumed that CST Spark was just the new name of their terrible CST Advantage plan. Group RESPs in general are terrible propositions as you have contractual purchases of units and front-loading of fees meaning often 2 years-ish of your first deposits goes toward paying fees.

Looking at CST Spark, I still see issues here. 1.5% management fee on an ETF portfolio you can do yourself, or a roboadvisor can do for a fraction of the cost.
CST Spark is a lot better than their group RESP Advantage plan, but I still wouldn't trust it. I haven't done an overview of their Advantage plan, but I did do a summary on Knowledge First Flex which has the same issues. You can see my reply on this webpage
scared-review-after-getting-resp-knowle ... t-1822643/

For flexibility, still lower fees, your bank would likely have comparable plans. What bank are you with and I can review your options with them.

A roboadvisor will effectively do the same thing here as CST Spark but with a fee of about 0.5% where CST Spark charges 1.5%
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speeeeee wrote: I use td for my kids resp
.basic aggresive couch potato for them. Set it and forget it
Same here. But if I need to do it today, I will just open an account at Questrade, and buy one of the Vanguard all in one ETF. I probably will begin with VEQT, gradually switch to VGRO, VBAL, and end up with VCNS couple years before the kids going to university.
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dropby wrote: Same here. But if I need to do it today, I will just open an account at Questrade, and buy one of the Vanguard all in one ETF. I probably will begin with VEQT, gradually switch to VGRO, VBAL, and end up with VCNS couple years before the kids going to university.
Actually in that case, I would utilize

VEQT and VAB.

Start with VEQT and slowly add more VAB each year.

Benefit:
-No selling so no commission on the sell until when your child actually needs the cash
-You can adjust slower rather than taking 20% jumps
-You don't have the issue of over- rebalancing (having the ETF reset the balance because one is too much equity vs fixed income and it unintentionally causes underperformance, this can theoretically happen)
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Jan 9, 2017
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xgbsSS wrote: Actually in that case, I would utilize

VEQT and VAB.

Start with VEQT and slowly add more VAB each year.

Benefit:
-No selling so no commission on the sell until when your child actually needs the cash
-You can adjust slower rather than taking 20% jumps
-You don't have the issue of over- rebalancing (having the ETF reset the balance because one is too much equity vs fixed income and it unintentionally causes underperformance, this can theoretically happen)
Best plan.
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Jan 22, 2009
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xgbsSS wrote: Actually in that case, I would utilize

VEQT and VAB.

Start with VEQT and slowly add more VAB each year.

Benefit:
-No selling so no commission on the sell until when your child actually needs the cash
-You can adjust slower rather than taking 20% jumps
-You don't have the issue of over- rebalancing (having the ETF reset the balance because one is too much equity vs fixed income and it unintentionally causes underperformance, this can theoretically happen)
@xgbsSS I cannot decide between VT and VEQT for my daughter's RESP. VEQT/XEQT is a popular choice here. But VT seems nice as well and has lower MER even with withholding tax on dividend. I can also convert my CAD into USD using Norbert’s gambit in Questrade's RESP account tp buy VT. Any input from you will be great appreciated!
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braveblade wrote: @xgbsSS I cannot decide between VT and VEQT for my daughter's RESP. VEQT/XEQT is a popular choice here. But VT seems nice as well and has lower MER even with withholding tax on dividend. I can also convert my CAD into USD using Norbert’s gambit in Questrade's RESP account tp buy VT. Any input from you will be great appreciated!
Honestly the MER savings is not worth the trouble even with Norbert's Gambit, IMO. I find the whole trying to save 0.12% is not worth the effort it takes. Consider the transaction time added to servicing this. The daily fluctuation could easily affect whether you gain more or less. On $3000 (A $2500 plus $500 grant) in one year, this is $3.60 difference, in 1 year but this is assuming you didn't miss out on gains while you waited for journaling and getting the transaction done. You have seen indices move 1-2% up or down each day. That kind of MER difference would be easily eaten up by these fluctuations. That's just me though. Buying the individual components like VCN, and then XAW would also make it cheaper without that much complication?

If you are making effort to do something complicated, it needs to be worthwhile. If it was a stock that you have done research and believe it was to go up quite a bit, then to me that is something worthwhile. Chasing fragments of a percentage point> Not so much.
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xgbsSS wrote: Actually in that case, I would utilize

VEQT and VAB.

Start with VEQT and slowly add more VAB each year.

Benefit:
-No selling so no commission on the sell until when your child actually needs the cash
-You can adjust slower rather than taking 20% jumps
-You don't have the issue of over- rebalancing (having the ETF reset the balance because one is too much equity vs fixed income and it unintentionally causes underperformance, this can theoretically happen)
What on earth are all these abbreviated terms? Sounds like coded language.
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mysttz wrote: What on earth are all these abbreviated terms? Sounds like coded language.
Those are the ETF ticker symbols. If you elect to buy them on a brokerage yourself (self-directed), you type these symbols.

Try googling VEQT ETF and see what happens.
Here are two links that would likely come up
https://www.vanguardcanada.ca/advisors/ ... 2/balanced
https://ca.finance.yahoo.com/quote/VEQT ... c=fin-srch

First link is the company's website showing you the VEQT fund. The second link is showing the stock market price of the fund.

But before you start anything, you need to understand what ETFs or investments are. You are jumping too far ahead. I recommend searching ETF to first understand what they are before looking at the symbols to buy.

https://www.getsmarteraboutmoney.ca/inv ... ucts/etfs/

So as discussed prior, if you were to go with CST Spark, you are paying them to buy ETFs for you, precisely 1.5% fee a year. Roboadvisors do the same thing and offer the same service including RESPs for 0.5ish %. If you learn to do it yourself, you can buy the same ETFs for free.
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