#RESP #EducationSavings #Investing #PersonalFinance
Hey everyone!
So, I’ve got a question about RESP accounts. My son’s account is currently stuck in a bank through my wife’s account, and I’m looking to move it to a self-controlled account. 🏦➡️👨👦
I’ve been learning a lot about investing and managing our finances lately, and I really want to take control of my kid’s education fund. After all, who wants the bank taking a cut of their hard-earned money, right? 💸💪
The bank mentioned that transferring the RESP account to another company could be costly – has anyone experienced this? 🤔
I’m thinking about creating a second RESP account and managing that one myself, while leaving the original one intact. Any thoughts on the best way to do this and minimize the impact on costs? 💭💡
I’m in Ontario, so any specific rules or regulations I should be aware of in this province? 🍁
Looking forward to hearing your insights and suggestions on how to navigate this situation! Let’s make sure our kids have a bright future without breaking the bank. 🌟💰
Find out how much Scotia will charge and ask wealthsimple to pay for it
Go to another institution that accepts all of the grants and incentives you currently hold in your RESP, set up a new plan, request a transfer through your new institution, sign the SDE0100 Part A form, your new institution will fill out and sign Part B and fax it to Scotia, Scotia will charge ~$100 for a transfer fee (not sure their exact amount, you would need to ask them), your new institution may reimburse the transfer fee.
You can still do self directed investing in your RESP through Scotia, it just has to be transferred to their iTrade platform (which they will do for free).
That said, their trade fees are higher than WS (though certain packages have a certain number of free trades).
Bank RSP’s are fine but yes you can stop and just make payments into a separate self directed one and you can even transfer the funds. The RESP’s people need to be weary of are the group plans where you commit to all sorts of penalties if you stop contributing or the child doesn’t go to school.
> The bank mentioned that it will cost quite a bit to transfer the RESP account to another company (i.e. Wealthsimple), but is this is true?
Your bank will charge a transfer out fee. Some brokerages will reimburse you for the fee you were charged.
WS will do so if you transfer at least $15k, but they don’t have self directed RESPs.
QUestrade will reimburse transfer fees of up to $150 per account.
What province are you in? In BC if you have the BC education and training grant in the account, you can only transfer that to another institution that handles that grant.
I tried to move an RESP from RBC (it was in mutual funds) to Direct Investing and they couldn’t do the transfer because at the time Direct Investing didn’t accept that specific BC grant. I now have half of our kids RESP at RBC and the other half and all future contributions at Direct Investing. Similar to you I learned more about investing and wanted to get out of mutual funds/go self directed.
Well, I k ow TD had RESP direct investing, and its a great platform. Fes are damn high, but thats par for the course with them.
I call BS on the cost to move it. There may be some admin fee and whatever cost to sell the what it’s invested in, presumably mutual funds but maybe it’s in something that you have to pay to break.
Or it could be an advisor who doesn’t want to loose his commission.
In answer to your other question, yes you can have multiple RESPs for the same child. You’ll have to give their SIN etc to open a new one, so the CRA has info that allows them to find out if you’ve exceeded the limits on contributions across all plans. In your situation I’d be inclined to have your bank open an RESP investing account and transfer your funds from the deposit account to the new investing account. Maybe there will be a small setup fee but I would hope not (and would ask them to waive it since you are a customer and will be paying fees per trade in the investing account). It’s likely easier on the other end (i.e. withdrawal when the child is in university) to have one account only.
We have two RESP brokerages. Coincidentally, scotia and itrade. Itrade is commission free to buy xgro. I’m in BC, and there’s a grant that scotia can get (BCTESG: $1200/kid) that itrade or questrade can’t get, so two accounts. Not sure what ontario offers in that regard.
How exactly is Scotia “controlling my kid’s education fund and taking a cut”?
The transfer out fee at Scotia is $150