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I am planning to open and manage a family RESP for my nephew at Questrade. My plan is to buy XEQT for the next 15-16 years. After that, slowly convert it to cash until my nephew reaches to 18.
 

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Discussion Starter #402
It just seems to me that an RESP doesn't need full equity level returns anyways. Fully fund with 4% returns gives $70k when the child is 19. Good enough. 7% stock returns gives $100k+

Just like an RRSP, it also makes sense that some Fixed income allocation is in this type of of deferred tax account (RESP is just like a Spousal RRSP in that sense, where the expected child/spouse is at a lower bracket than you are in the distant future), and your stock allocation is in unregistered and getting better tax treatment.

I know some people don't like to consider an RESP as "my money" anymore and so maybe wouldn't include it as part of their portfolio and asset allocation. But to me that is somewhat wishful thinking about a prosperous future that hasn't unfolded yet. If SHTF, people will be quickly discovering that the RESP is actually still their money, and they'll be extremely happy to find that there are some bonds in there, too.
 

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My brother doesn't make much. I doubt we will be able to max out the RESP account. Also, I think tuition fee will be very expensive in 2040. So, $100k in RESP may not be sufficient to cover 4 years bachelor degree. Can the RESP money be used for monthly expenses along with paying the tuition fees?
 

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My brother doesn't make much. I doubt we will not be able to max out the RESP account. Also, I think tuition fee will be very expensive in 2040. So, $100k in RESP may not be sufficient to cover 4 years bachelor degree. Can the RESP money be used for monthly expenses along with paying the tuition fees?
agreed, I think tuition by then could be over 100K for 4 yrs in current dollars (so even more in future dollars).
RESP money can be used for anything. tuition, books, rent, food, cars, travel, whatever you want. The only requirement is that the child is in proper post secondary. Some people are using it as an additional RRSP type investment (tax sheltered gains, but after tax $) once their RRSP and TFSA is full. Of course, there's no requirement that you fully fund your child's school (or even that they'll go) either. They should have some skin in the game too. The banks always ask about RESP balances when applying for loans, which tells you that they consider it to be your money as well...
 
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