Your RESP strategy will be influenced primarily by the age of the plan beneficiary(ies), which will guide you in establishing the basic asset allocation of the account. The number of years remaining until the beneficiary(ies) enrol in post-secondary studies will guide you in the selection of appropriate investments and signal when the mix needs to be adjsted.

The First 5 Years

Early Strategy

During this period, most investors are willing and able to endure greater volatility in asset values and are focused on those investments likely to provide greater long-term growth. Your portfolio should have a longer time horizon with a healthy weight in assets that will enable greater capital appreciation.

The Next 5 Years To top

The Middle Years

During this period investors should begin to focus more on income generation and the preservation of capital. The beneficiary is now nearing the point at which post-secondary studies will begin and a shift in the asset mix is suggested at this point. Your portfolio should maintain a growth bias, but at the same time a shift towards income funds will reduce overall portfolio volatility.

The Last 5 Years To top

End Game

There are only a few years remaining until the beneficiary will commence post-secondary studies, but you must consider the three to four years during which time they will be in school and drawing on the funds in the account. During this period further emphasis should be placed on capital preservation and income generation. You want to effectively lock in those gains made during the earlier periods in order to maximize the funds available to the beneficiary during their study years.