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  1. #1
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    Default RESP - Bank vs. other institution?

    Are there benefits to opening/contributing to RESP's through a bank vs. other institutions? How to choose?
    Thanks

  2. #2
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    Hi Hannahsmom!

    I'm not aware of any differences with how much grant money you get or if there are higher fees on the account between a bank and something else.

    RESP's are alot like your RRSP - you can ask that the money be invested in different types of mututal funds or bonds or even individual stocks (if you've got quite a bit in the account).

    Some plans are called “pooled plans“ (places like Canadian Scholarship Trust, Heritage Education) which take your money and then pool it with other peoples money and then divide it up at the end based on a specific formula. I don't know much about these plans and don't use one myself (our RESP's are family plans with a broker not a bank). There are more critics of this type of plan (and lots of supporters as well ) so I'd suggest you do your research before committing to any type of group / pooled plan.

    Hope this helps but don't hesitate to ask if you still have questions!

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    I was told by my financial advisor to look at how those pooloed plans invest over the long run. Some are governed by rules as to how your money is invested. . . e.g. For first 15 years your money is invested 100% in stocks. At 15 years, your money will be put into bonds regardless of how the market is perforrming. Even if it is the absolute worst time to make the switch, they are bound by the pre-existing contract of how they will invest your money. Just another item to inquire about when doing your research.
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  4. #4
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    Thanks Andreamcd13,

    There are those who really like the pooled plans and those who really don't like them. I suspect even within the pooled plans themselves there are lots of good and not so good plans.

    Any type of investment choice should be based on knowing what you're getting into and your own personal comfort levels and objectives - which can be so different for people.

    Thanks again for the info

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