Location: Brampton, Ont, Canada
Posted on: 10-12-08 08:13:08
Hi PatrickM
I salute 2 U. I am impress how you efficient u reply to all post and help us.
not everyone has this quality. i hope best for u since u r very helpful.
BACK to the point.
I am in Montreal, so my baby was also born in Montreal, Its only four month for second one so i dont know yet if its a boy or girl 
but in two weeks i will be able to know.
would u please advise me how to start with RESP ? i hv account with TD and one more thing i m moving to Toronto in after my baby's born . so i am thinking of holding for investment till this summer.
what is your feedback
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'Some goals are so worthy, it's glorious even to fail.' (Param Vir Chakra awardee Lt. Manoj Pandey)
Quote:What options are you looking for?
Originally posted by shaileshjkumar
Thanks Pratikm, I am going to find out more details about the RESP self directed family plan from out of the top 5 banks and will go ahead with the one which suits the best as per my plan for investment growth and security of the principal. I’ll make sure to go through CIBC’s option carefully. My primary banks are BMO and Scotia and could not find them much of a good option.
Both Scotia and BMO have fairly standard offerings for RESP.
You won't find too much differentiation between the big 5 banks.
Their offerings are very similar, fees are similar and the mutual fund offerings are similar as well.
If you want a self-directed account, again their brokerages are very similar to each other.
I suggest go with whichever bank you are comfortable with and have most of your accounts in.
If you have a comfortable relationship with someone at one of your banks, go with that one.
You don't necessarily need to open a self-directed RESP account, if you are not going to buy individual stocks, bonds and third-party mutual funds.
To begin with, you can open a regular RESP account with one of the banks.
That will allow you to hold GICs, high interest savings and a limited selection of the bank own mutual funds in that account.
For most purposes, those funds should be ok.
This type of account should not have any annual fees, etc. (other than mutual fund fees).
A self-directed account at a brokerage (like Scotia McLeoud) will enable you to purchase stocks, bonds and mutual funds outside of the bank such as common stocks traded at the Toronto Stock Exchange (TSX).
This type of account will have some annual fees at the brokerages if your account is below a certain balance.
There are other discount brokerages, like E-Trade, that have no fees at all.
Since you are just starting out with investing, I wouldn't recommend buying common stock and bonds.
And for RESP, there really is no need to do so.
You can do quite ok with the bank mutual funds and high interest savings accounts.
Quote:Don't worry if you don't know about mutual funds and ETFs yet - there is lots of time to learn.
I just wish I had known more about the mutual fund and what bond index fund, TSX index fund and ETF. But by time I it will be clearer and would be able to decide what to do with what is in the RESP account. I wanted to know if the self directed family RESP plan is flexible to move the funds from one type like GIC to another like Mutual Fund in later days like after 5 years time. Also, I would be able to move the grant money same as my portion of RESP.
Start simple with fixed term GICs and high interest savings account.
Don't let the bank representatives (or anyone else) talk you into buying complex products that appear sophisticated and you don't understand clearly.
Later you can start researching mutual funds and go with low fee, conservative investments.
Your child is very young now, you have many years of compounding so there is no need to buy high risk investments.
Quote:Wow, doesn't seem like there is much "interest accrued", is there?
]Originally posted by nari
Based on the phone conversation i had with Customer service that i had called yesterday he told me my total money in the account was roughly about $3200 including grants, my contribution ($2000), and interest accrued. He told me if i moved out of the plan they would deduct about 1350$ Enrollment fees out of this total amount and pass on rest to other institution where i want the money to be moved.
Your $2000 plus the CESG grant and the ECESG + Learning Bond grant (if you were eligible for those two) add up to more than $3200.
So it appears that you are losing money rather than making any.
Quote:Technically it doesn't matter where you open the account, but since you plan to move right after the baby is born, it's better to wait.
]Originally posted by Blue_Peafowl
would u please advise me how to start with RESP ? i hv account with TD and one more thing i m moving to Toronto in after my baby's born . so i am thinking of holding for investment till this summer.
what is your feedback
Once you have settled in Toronto and transfered all your bank acocunts then open the RESP.
A couple of months isn't going to change anything.
If you are happy with TD, stick with them.
They offer fixed term GICs and their mutual fund selections are pretty good too.
Hope this helps.
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"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
Location: carl sagan's universe
Posted on: 10-12-08 17:11:51
Quote:
Originally posted by nari
Good question Pratickm, I will call the customer service once again tomorrow and check where my funds are invested. Actually, i opened the Account with Global back in 2006 when my daughter was born. I deliberately didn't max out in investing with this account for 2 reason first i also thought same way like you didn't have confidence with trust companies and other if i had to move out of the country or had a job loss i wouldn't have been able put in max amount. I thought it was a good idea to make a lumpsum amount any time rather than committing to maximum Limit.
The other reason i opened with Global was i wanted to give some business to a family friend whom i couldn't deny as he is an Agent with Global.
Based on the phone conversation i had with Customer service that i had called yesterday he told me my total money in the account was roughly about $3200 including grants, my contribution ($2000), and interest accrued. He told me if i moved out of the plan they would deduct about 1350$ Enrollment fees out of this total amount and pass on rest to other institution where i want the money to be moved.
Looking at this calculation it seems if i move all my money i loose all the government grant upto now plus the interest.
Once again Thanks Pratickm & Investpro and all others for building up these thread with your expert opinion. I definitely think it would help others like me who have some confusion or want to clarify things with respect to RESP investments.
Hi Nari,
something doesn't gel here. I don't mean to pry but if you opened the plan in 2006 committing $50 a month, even if I assume that you opened the plan in Jan and incl the PAC of this month it would total $1800, unless of course you contributed extra in a year.
Also if you bought 22.42 units at $504 a unit that is a total of $11300 over the span of the plan.
If you are paying $50 a month that would total 226 months you are paying which is 18.83 years, which is OK, but why contribute for that much time if the grant is only available till when the child is 17?
Did you buy this plan when the child was newly born?
If that is the case and you really paid $2000 so far then you should have got a minimum of $400 from the govt plus $500 CLB which totals $2900.
If your household income is below $77,000 now and in previous years indexed lower by the percentage equal to the inflation index then you should have got 30% on the first $500 contributions every year.
Add to that the extra $100 every year.
This all should add up to more than $3200
Unless of course they haven't given you the $100 of this year nor the last 20% grant of your last contribution.
Do you have the statement sent to you earlier this year which should show you the contribution, grant, CLB plus accrued interest?
Quote:Correct, which is why I said that it appears the account is losing money instead of gaining.
Originally posted by investpro
This all should add up to more than $3200
Unless of course they haven't given you the $100 of this year nor the last 20% grant of your last contribution.
Do you have the statement sent to you earlier this year which should show you the contribution, grant, CLB plus accrued interest?
I assumed that it may be so because of the fall in value of the underlying investment and/or the fees drag.
But it's possible that the calculations are wrong or the person on the phone said the wrong amount.
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"Mah deah, there is much more money to be made in the destruction of civilization than in building it up."
-- Rhett Butler in "Gone with the Wind"
Regarding investments in second RESP Plan:
I have room for contribution towards another RESP after paying my first plan with Global.
So far the investments @ Global have been safer, return of approx 5% p.a. Global invests the funds in bonds (govt., provincial, municipal and corporate) plus in cash and principal protected notes.
In order to avoid additional enrollment fees at Global (refundable), I am thinking of opening one more RESP plan with RBC bank. This way I will have a flexibility to choose my investments in RESP and reap the benefit of dollar cost averaging.
Looking at the SHORT window of this plan (3 years) when the child enters college/University, what will make better sense in your opinion:
1. To invest in low MER currency neutral ( I am bearish on USD) equity index funds; US Index, International Index, and Canadian Index. Looking at the index, it appears that markets might bottom out in the next few months, followed by surge of 6% or more p.a. in the next 3 years.
http://www.rbcam.com/pdf/information/rmfiri.pdf
http://www.rbcam.com/pdf/information/rmfusr.pdf
http://www.rbcam.com/pdf/information/rmfcdi.pdf
2. Stay away from equities and stick with low return safer investments such as: Canadian bond index funds/GIC/ High interest savings a/c etc.
http://www.rbcam.com/pdf/information/rmfcbi.pdf
Regards,
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Amit Kalia, Broker, REALTOR®
RE/MAX Real Estate Centre., Brokerage
independently owned & operated
100 City Centre Dr, Unit 1-702
Mississauga, ON L5B 2C9
Phone No.: 905-339-5111
Website: https://www.realestate-ontario.com/
Condo Blog: https://condopundit.com/blog/
Location: carl sagan's universe
Posted on: 25-01-09 22:37:26
Hi Amit,
for a 3 yr window, and if you are happy with Global why not continue with Global- tell your pal you want to invest extra every year without buying units as to avoid paying the enrollment fees.
Global also has a group sponsored plan where there are no enrollment fees and the return is the same as you are enjoying now.
He'll arrange it for you.
However if you are bent on making RBC richer than it is, by all means invest there.
equities for a 3 yr term - I do not advise. However if you are looking to use the new money you invest now towards the end of uni years in say 7 years- then why not if you have confidence that the markets will bounce back.
Do not rely on what the experts say anymore re the markets as they know 'anda'- believe you me they are full of scatological material, but newspapers/mags have to fill their pages, TV channels have to fill up airtime, colleges have to call in 'expert' guest speakers as part of their program etc. etc and they all know a big goose egg, myself included.
Sometimes when I am giving a seminar, I am thinking to myself- what garbage am I talking? At a recent financial forum, I gave a talk on where the markets were going and believe you me, I analysed it all using certain factors, but what if those factors don't play out? Basically I was giving out balderdash like every other speaker, but they will never say so except after their tongues are loosened by booze as their livlihood depends on it.
My livelihood does not depend on the speaker circuit, so I am telling it like it is.
Keep on with Global is my advice but just do the top-up so you avoid paying the enrollment fees as from the looks of your post that is a deterrent despite it being returnable.
Hang loose.
Thanks investpro.
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Amit Kalia, Broker, REALTOR®
RE/MAX Real Estate Centre., Brokerage
independently owned & operated
100 City Centre Dr, Unit 1-702
Mississauga, ON L5B 2C9
Phone No.: 905-339-5111
Website: https://www.realestate-ontario.com/
Condo Blog: https://condopundit.com/blog/
