RESP: Where is the best place to buy them? And how much per month etc.

[free_feels_good]

I have 3 kids, 9, 4 and 2, I need to set up ASAP. As of right now i can only afford $200/kid/month


Please help. Any advice, big and small is greatly appreciated

[Zonny]

$200 a month is more than I do. We just get them at the bank. There's going to be lots of folks here who will tell you not to buy them though. I'm no expert, so I will stay out of it!

[Shwa Girl]

There's going to be lots of folks here who will tell you not to buy them though.

You are reading my mind, before I posted. I guess I am one of those folks

[sweet sparrow]

http://www.amazon.ca/RESP-Book-Regis...ords=resp+book

I found this book really helpful, and available free from my local library. $200/child/month is amazing. The maximum government grant per year is given if you contribute an amount equivalent to $208.33 (or $2500/year). If you can swing an extra $8.33/child/month you'd max out.

I definitely wouldn't contribute to group plans, but banks should be safe to start with.

[spanishpoet]

I went with an independent financial advisor and with his guidance we chose the stocks to invest in. We have one child and put $150 biweekly into a TFSA and then dump the $2500 into the RESP at renewal time to get the $500. Then we have the left over money in the TFSA for him to use when he goes to school, since I highly doubt the amount in the RESP will be enough. Our little guy is 5 months old and as soon as his SIN arrived we put the money in the RESP to ensure that we get the bonus.

You might find this article helpful:http://www.moneysmartsblog.com/resp-reference/

[Retiree]

We opened RESPs for our grandchildren, who are in 2 families. We did this through our bank. We are working on putting away $10,000 for each child. We set each group up with a family RESP so that it doesn't matter which child/children, in each family, accesses the funds, when/if they are ready for post secondary education.

We chose to protect our initial investment by putting it into GICs. It won't earn as much but will not be subject to the volatility of the markets. When the grant money comes in, we put it into a mutual fund.

[beckie.c]

I ended up signing my RESP over to my younger brother because I was making too much money as a student in our co-op work program to benefit from taking it out of the RESP because of taxes.

[Zonny]

I ended up signing my RESP over to my younger brother because I was making too much money as a student in our co-op work program to benefit from taking it out of the RESP because of taxes.

I didn't know you could 'sign over' your RESP to anybody, I thought if it wasn't a family one it was just yours.

[beckie.c]

I didn't know you could 'sign over' your RESP to anybody, I thought if it wasn't a family one it was just yours.

Yep, I posted a little more info below from a site. It depends on age of the children and the amount you have in the RESP when determining what is the best value for a family, but for our family it was more worthwhile if my brother used the money due to the fact that I was working 6/12 months for $20+ an hour plus scholarships and he was unemployed and under 21 when he started school. When we worked it out I would have had to pay taxes on the money I withdrew where he didn't. I don't know exactly all the details, my mom was in charge of that stuff then and I don't have kids yet so I haven't really looked into it. All I know is it was in my name, and I signed some papers and it went to him.

Transfer the money to another child’s RESP

Your child may not need or want the RESP — Hartman’s brother is a great example of that. In these cases, tax-free transfers can often be made from one RESP to another — as long as you don’t over-contribute.
To transfer RESP funds, there must be a common beneficiary between the originating and receiving plan or the beneficiary must be under 21 and a brother or sister of the original beneficiary. Additional conditions may apply if grants have been received in the RESP, so it is always wise to speak to your financial provider before making any moves.

source:http://brighterlife.ca/2011/12/02/re...to-university/

There is also info on the gov website: http://www.cra-arc.gc.ca/tx/ndvdls/t...frrng-eng.html

[free_feels_good]

thank-you all for your wonderful advice and the math works

I like RESP combine with the TFSA ideas.

[free_feels_good]

More advice please...

[lizzie bargain]

I strongly agree with the advice to open a family plan so that any of the children in your family can easily access it. I too have invested mine very conservatively as of late in GIC's at the bank as I have a child approaching university age. Not a great return but my feeling is I am already getting a 20% return from the govt grant and so I personally do not want to take unnecessary risk with my contributions and the govt grant. Parents with a lower income can get an extra grant each year. I believe this would be in addition to the 500 max per year per child

1. Additional Canada Education Savings Grant
   Depending on your net family income, you could receive an extra 10% or 20% on every dollar of the first $500 you save in your child’s RESP each year.

Here in Alberta we did have a provincial grant contribution to the RESP as well but I think that is being cancelled-not sure if other provinces have anything. One of my friends had one of those group RESP's and because her son did not attend post secondary within a couple of years of finishing high school they forfeited some money. Luckily I think they also had some in a family RESP that he is now using at age 25 as he putzes his way through a degree. Some kids I think, just mature later and are ready to continue schooling after some time in the workforce/traveling etc. My personal feeling is that I would not want to shell out the dollars until the student is ready to give post secondary their best shot and work hard at their studies-otherwise it can be expensive paying for them to goof off if they are not yet ready-just my opinion. I also think you need to start contributing before a child turns 16-17 in order to get the grants so I applaud you for getting started now. It appears by their ages that you are likely to have at least 2 children in school at the same time so I am sure these funds will come in handy when the time comes. Good luck in finding a plan that you are comfortable with!

[Gsxrboy]

Everyone has given solid advice, the only two cents that I would add is make sure to understand the fees that are charged. When investing in some sort of funds, there is an MER (Management Expense Ratio) that is charged as a percentage. 2% annually may seem minimal, but when calculated against $100,000 then it becomes something to think about.

[lucy16076]

My 2 cents....put your money into an index fund, buy & hold....I wish someone would have told me that 13 years ago when I started our RESP for the two children we have. There are better avenues with much better rates!! TD Waterhouse & Vanguard...check them out!

[Carlotta]

You do not need to have a family plan to be able to switch beneficiaries. You can transfer easily from one child to another by just changing beneficiaries.

However, why would you NOT open an RESP when you can automatically get 20% growth by way of the government contribution? The only caveat to that would to be to open it with either a bank or a financial planner. Do not open one with USC or one of the "Education Plan" companies. Their fees are atrocious and they are very difficult to get out of.

And Im not sure I understand the TFSA thing? You have to be 18 to open a TFSA, so that makes no sense. If you put it into your own TFSA and then transfer it at the end of the year, you are losing a year's worth of growth on the government contribution, so that makes no sense either.