Just to save someone else the hassle, the new “2008″ version of the page which includes the clause of interest attribution for the CCTB/UCCB payments to minors, it is now at:

http://www.cra-arc.gc.ca/E/pub/tg/5000-g/5000-g-02-08e.html#P532_55436

Thanking in advance.

Wow that enrollment fee is outragous, you should report them to an investigative news service like Olsen on your Side to slam them with bad press.

If the pooled plan is strictly bonds, then maybe you could stay invested in it, but don’t contribute anything more. Start a second separate RESP account with TD e-Series and do your monthly dollar cost averaging contributions but don’t invest anything into the TD Bond index.

@ georumble.com

Their fund sound too conservative, you’ve got over a decade to invest and are very fortunate to be starting at a market low, you could take advantage of that by having more market exposure. Plus the MER is twice what you’d pay with TD e-Series funds.

I just opened individual RESP’s for my 6 and 2-week old sons at BMO Mutualfunds, the money is invested into their Intuition RESP Savings Portfolio with following distributions(i think):

50% GICs
38% BOND Fund
12% DIVIDEND Fund

and they say the overall MER of the portfolio is about 0.8%

Comments?

Thank you,

G.

would that mean that I could get 550/ year grant money if I put $2500 ? or is there a cap of $500 grant money

question2:
unused CESG can be carried forward. so if our net family income is between $37,885 and $75,769 and we only put $500 into RESP to get the $150 grant. what is the amount of CESG that can be carried forward ? $400 or $350.

I am curious to know because we are planning to only put $500 on RESP to get the additional CESG for now and put the rest into our mortgage. then when we are done with the mortgage we can catch up with the RESP without losing out on the additional CESG bonus. Does that sound correct ?

yes, I moved from pooled plans and lost 6K in the process…

about the actual numbers, i also have a table i made up for the same purpose – fill in your numbers.

As far as the enrollment fee goes – you’ve already lost that amount regardless of what you do, so that shouldn’t factor in the decision to move or not.

Please help me to make a RESP investment decision. I have a 3.5 years old son and a 1 month daughter.

Current RESP Plan for my son: Global Education Trust Plan
Invested till date: $6800 (since 2005)
Enrollment Fees: $4294, Principal:$1450 CESG/Growth:$1050
Rate or return: 5.5%, 5.5% and 4.7%.

I am thinking of moving from Global Pooled RESP to TD Efunds/Questtrade Family Plan for the following reasons:
1. Flexibility to select investment – It is all Bond investment; so low growth and risky during inflationary period (I guess bond prices would come down during inflationary period)
2. Better growth return
3. Will not loose income in case I move out of Canada (remote possibility)

If I move out of Global Pooled RESP, I will loose enrollment fees of $4294.

Hypothetical RESP compounded growth projections (assuming $2000 annual investment for next 15 years):
Global Pooled RESP @ 5% growth: 68,545.88
Global Pooled RESP @ 3% growth: 56,594.06

Self-directed RESP in TD e-funds/Questtrade (assume enrollment fees is deducted)
Self-directed RESP @ 7% growth: 71,746.20
Self-directed RESP @ 5% growth: 59,814.38

1. Please comment whether moving out of Pooled RESP now, loosing $4294, is a bad idea.
2. Which one is better? Monthly TD Efunds contribution for dollar cost averaging or Yearly (January) one time contribution in ETFs for higher compound growth rate (As money stays for one year longer)?

Thanks in advance,
JP

I have an RESP set up with TD, and am using e-funds in an agressive couch potato manner. (Agressive couch potato sounds like quite the oxymoron.)

Anyway, I have money deposited in three funds – Canadian Equity, U.S. Equity and International Equity – each month.

I have a question regarding the government cash that comes in as a result.

I tried to get it split three ways, so equal amounts get put into each fund. After initially being told this was no problem, I discovered a money-market fund in my account, and found the grants were being placed into it.

Asked TD again, and was told that the government funds CAN’T be put into e-funds, despite what I was told initially.

Anybody else have this problem? Is it correctable? Any info would be very appreciated.

Thnx

That’s quite useful if you don’t want to use the RESP – or have more money outside of it.

Mike

My two cents, Spudman

“Generally, when you invest your money in your child’s name, you have to report the income from those investments. However, if you deposited Canada Child Tax Benefit or Universal Child Care Benefit payments into a bank account or trust in your child’s name, the interest earned on those payments is your child’s income.”

http://www.cra-arc.gc.ca/E/pub/tg/5000-g/5000-g-02-07e.html
(under Line 121)

So now I wonder is an “informal trust” account different from a “trust”?

I’m not sure if hiding the account is the best option, when they find out when they get older, don’t you think that they would be resentful for not telling them earlier?

For the informal trust you could just never tell your kid they have the account, if they’re crazy at 18, don’t tell them until they’re ready. Just let them try and find it if it comes to that.

The biggest downside is that when the child turns 18, the money automatically becomes theirs regardless of if you think they are ready for it.