I’m pretty sure they will get split if there is a divorce. I’m not sure about the bankruptcy – you’d hope they would get protection similar to an rrsp.

Personally if I was in deep financial trouble I wouldn’t hesitate to use the RESP money to keep us afloat.

You’re right about the broad definition of post-secondary education.

If a beneficiary dies then it’s treated the same way as if they didn’t go to school. So the plan gets collapsed, penalties on earnings get paid etc. It can also be transferred to another beneficiary.

Mike

1. unseizable in event of bankruptcy or marital breakdown – it truly belongs to the kids, no matter what befalls the parents/family

2. the definition of “post secondary education” is very broad – it is not strictly for university, and it is also egalitarian in that it doesn’t necessarily require the student to actually GRADUATE from the post-secondary programme (ie. the money flows regardless of any scholastic results, but is dependent on continued enrollment each year (which allows for switching between institutions and courses/programmes))

3. it’s a good bet that between now and 2020, some politician will make RESP withdrawals tax-free, as a way to spur more savings on the part of the electorate – the likelihood of INCREASED taxes at a later date seems slim by comparison

4. they are very expensive/complex for the banks/dealers/brokers to provide (all the admin function lands on them – they have to keep track) so it’s a chance to make them earn their various fees/commission, LOL

i am unsure what happens in the case that a RESP beneficiary dies – is that a special case of not attending post-secondary eductation or do the default rules apply??

F

I’ll change the example.

Mike