Author Topic: RBC Target Education Funds (RESP)  (Read 678 times)

Kayteekate

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RBC Target Education Funds (RESP)
« on: February 07, 2018, 06:43:39 AM »
Hi everyone,

I have been looking for a solution for my children's RESP account and I just don't feel quite comfortable or savvy enough to manage it myself at a brokerage account. I know there is the option of the TD eseries account but as I mentioned before certain grants cannot be transferred into the eseries.

Iam looking for a simple solution. Is anyone invested with the RBC target education fund? Please give me insights. I believe the biggest factor would be the MER but I would gladly pay for the convenience seeing as currently my RESP is in a GIC and feeing overwhelmed as well as having investing paralysis. I must mention Iam a beginner investor. 

Thanks for reading!

Prairie Stash

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Re: RBC Target Education Funds (RESP)
« Reply #1 on: February 07, 2018, 09:09:29 AM »
I hate them for myself, my RESP is currently at RBC. However, they're a decent product if your choice is Heritage funds or one of the pushy RESP providers. If you really are worried, its a good place to temporarily park the money while you figure out something better (that could be 5 years or forever, no judgement here).

My new strategy is to move the account to National Bank. Then purchase ETF, same ratio as the Canadian Couch Potato (CCP) recommends for a RRSP (timeframe is 15 years for me). I'm very careful where I bank to maintain the RESP matching.

I looked at RBC target and realized you can buy 2-3 funds and get the same results for less cost. The trouble was rebalancing, but that's actually easy (look at the target fund and make sure you match their allocations). Direct new money into purchases, don't worry about selling until the kid is a teenager.

Sometimes a good fund is better than the perfect strategy. In this case RBC target is good, better than GIC. If my perfect strategy represents 100%, I give the RBC Target a score of 85%, a GIC scores 20% (better than only cash). Heritage and the other RESP providers are about 55%, they have higher fees.

Isn't 85% pretty good? Better than you have now, while you work on getting it to 100%? Paralysis is the biggest problem, far bigger than account selection.

Kayteekate

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Re: RBC Target Education Funds (RESP)
« Reply #2 on: February 07, 2018, 10:07:16 AM »
Thanks for the insight Prairie stash. I guess as long as Iam moving forward I'm doing the right thing. Although I know there are better strategies I should just start somewhere. I guess the positive is that I have time on my side (kids are age 3 and 1). I do agree the RBC Target fund is better than a GIC, good enough for me at the moment I suppose. Thank you, I needed reassurance.