Your opinions on RESP: GIC vs Mutual Funds

Hello all, I recently visited my local TD bank and needless to say the financial advisor I met with confused me with her colorful charts and graphs that she didn't even know how to read. Anyway, I wanted to open a RESP for my daughter who is 2.5 years old with a $50 deposit every 2 weeks and the flexibility to deposit more whenever I can. My goals were to put away a little on a set schedule and take advantage of the government contribution. I thought there was only 1 type of RESP, but the financial advisor said there is the mutual fund (10% return) which I'd make more money in the long run and the GIC which is very low like 3.5%. I was afraid of losing my principles and went with GIC since it's a guaranteed type of investment.
Thoughts? If you currently have RESP, which one and why?
Thank you.

I do have RESP for both my girls and I found that it was amazing when it was time for them to go to university . Still have a DD who is entering her 2nd year. I didn’t go with a bank. I did mine with Knoweldge Finiancial and contributed into a family group plan which was my understanding at that time would make more interest. But mine was a fixed amount every month. I also did lump some whenever I have a little saved up . There is a lot of info on there website if you look it up. Hope this helps

I did mostly GIC-I am like you and not wanting to risk my principle-even though perhaps I could get more long term I did not want the risk-my reasoning was since I was already getting a 20% grant from the govt the GIC interest in addition would be enough. DD is now starting second year and we had plenty saved-mind you we did put in the max 50,000 even though not all of that received the grant.

Did spot this week an article about how a parent can go about getting the RESP money for their scholar child -it requires advance notice to the plan:
https://www.thestar.com/life/advice/...lars-resp.html

You may also find this page of definitions from the CRA on RESPs useful:
https://www.canada.ca/en/revenue-age...ns.html#family

There is a book that you can get at your public library called The RESP Book by Mike Holman
One strategy he mirrors is investing like The Canadian Couch Potato portfolio#2
https://canadiancouchpotato.com/model-portfolios/

With inflation running just under 2% and the GIC paying 3.5% deduct fees etc., not the greatest investment. The 20% government top up is a bonus.
Do not go with bank mutual funds if you can possibility escape them because of Expensive management fees.
Lots of low cost mutual funds and EFT’s out there that track the market.
Read, read, read.
Do not go with bank advice - they are maximizing their profits not yours.

I second dagney's advice, but will add the following:

• An RESP in a GIC is always better than no RESP at all just due to the government match.
• GIC vs mutual fund is a tossup, sometimes better one way, sometimes better the other. But watch for the mutual fund fees - there are plenty of 'em, and they are high. And for no good reason, other than that people just pay them.
• Low cost ETFs will be the best of the bunch. It is not really that difficult, but it is a hurdle with which many have trouble. For instance, banks are now paying dividends in the 4-5% range, which beats GICs by a mile.

So doing something is better than nothing. Doing ETFs is better than GICs if you can stomach it (it's not difficult, but you should consider whether or not you have the temperament before you make the leap).