This is good advise in investment for beginners. Lazycat, you are introducing the balanced fund which lots of financial advisers will likely provide to people. The reasons are: low risk, higher return than fixed income.
I guess mustard's problem now is that she does not know what choices are available for RESP and like most parents new to this, she needs to find the right type.
There are normally 3 ways people manege RESP:
1 Handle it by yourself. This is good for ppl know market and themselves well enough. I mean they know market well enough to invest stock/bond/fund/GIC, etc . And at the same time they know their own expectation of the return. (Most people from 《投资理财》do this, right?
)
2 Go to any financial institutions including banks and ask their financial advisers to make a plan good for you( mutual fund/bond/GIC, etc) . This is for most people who do not know much about invest. It does not matter it is from big bank or invest companies, you need a person know well enough what is best benefit for your interest and educate you.
3. Go to the pool fund. There are listed institutions in Canada do pool funds, they are fixed income, stable but not flexible. you can only continue paying until kids go to university or you lose a big $$$. There are lots of ads for them and advisers for them too. Lots of Mid east and Africa people do so locally in Ottawa due to their family size.
Typing is tiring. I should do less.
hope this helps people who wants to buy resp for their kids.
There is a type of security that is offered by banks and you can check out with yours. Scotia offers this periodically. Highlights are:
1. Cost of investment is determined on the contract date.
2. Principal is guaranteed by the bank (or the security arm owned by the bank).
3. Return is determined on the date three years later based on a basket of index and bonds with a cap on maximal return (at ~66%).
This is probably the safest investment you can get for some exposure to equity market, especially in current low interest and low stock market environment.
