IT IS POSSIBLE. WE CAN SHOW YOU HOW…
The solution is NOT the RESP. It has nothing to do with the government savings grant. When you really drill down into that plan, you'll see that the RESP is full of holes. In the 18 or so years that you spend contributing to an RESP, you are more likely to fall well short of the money you'll need when your kid is ready for university than to be able to fund it. That's a FACT.
All the online RESP calculators tell you that you can expect to need anywhere from $105,000–$145,000 to fund those university years. Per child. We don't know of any RESP plans that can possibly achieve that.
The UnRESP is a real method — it's not at all hypothetical. We can make this happen in a hurry. Let us explain —
In its simplest explanation, the UnRESP is a plan to buy an entry-level condo with the absolute minimum down payment needed and to not contribute anything beyond that each month. Fund it once, and never again. We really scrutinize for the right property that meets a bunch of quantitative and qualitative measures.
If you do nothing but (have your tenant) pay your mortgage, we guarantee a wonderful return on investment (ROI). After a number of years — when your child is ready for their freshman year — we'll help you set up a plan to rework the financing of the condo, and without contributing a single cent of your own, you'll access all the money you'll need to pay all the university costs, AND your tenant will be the one making all the monthly payments to cover it all!
Sitting in a meeting with your RESP advisor, it's easy to find reasons to be sold on that savings plan. You put in some money and our government GIVES you free money. Together, that money builds and BOOM!, you have the money you need when your kid is ready for university, right?
Hang on a second… have you ever really run the numbers to see how your money actually works? Can you realistically expect to earn the money you need to in order to fund your kid's education? Short answer is: likely not.
When you look at the RESP, it really doesn't seem like the ultimate solution that we're being sold on. The UnRESP is the real solution. It's everything we expect it to be and more.
What exactly are you investing IN? Do you understand the underlying investments? You know you're contributing to your RESP monthly or yearly, but what is your money doing? What is it earning? How does money actually come out of the RESP? What if your child doesn't go to a qualifying post-secondary institution?
We hear "FREE MONEY" and fireworks go off in our brains. We're told that the free government grant of $500/year is magical — basically a guaranteed 20% return. We'd be stupid to ignore this, right? Wrong. This trick blinds us from making REAL money.
We'll explain everything to you, hold your hand as long as you need us to, and it doesn't cost anything to get started.
Both of these plans are about saving for your future.
The RESP is a Savings Plan. Nothing more, nothing less.
The UnRESP is a savings plan. And, oh, it's so much more. It's also a retirement fund, an insurance policy, an appreciating asset, a personalized pension, and so much more. It's what you need it to be to fit your life. It's not a plan designed to pay your financial advisor.
This plan encourages you to buy and hold a small real estate investment (likely a condo) rather than contribute to an RESP. We've been through this. We've seen the results. We look at the math over and over.
Every single parent we've spoken with in our research has been unable to rely solely on their RESPs to fund their child's education. Wasn't that the point of starting the RESP in the first place?
If you put down $2,500/year for 18 years and max out the government grant each year, you need to earn 7% each and every single year on your investments in order to break even on the costs — let's call it $120,000. If you put your money into our UnRESP, it's not unreasonable to expect equity gains of $600,000 over those same 18 years.
I'm always on the lookout for investments — the ones that you make and you JUST KNOW that it's the right thing to do. There's something about creating passive income that really, really excites me. Much more than anything else I can buy in that moment.
When my first daughter was born — along with starting her RESP — we bought a pre-construction condo in downtown Toronto. We paid $300,000 for the condo and had to put down 20% over the course of a year → so, our investment was $60,000.
It took a few years before the building was completed, and when it was we had it rented pretty quickly. We found a glorious tenant. We agreed on a rental contract at the lower end of rental market value, and we never really increased her rent. She kept amazing care of the place, never really called us for any issues and so we wanted to reward that by not increasing her costs. We were probably out of pocket $100–200 each month. However, we were paying down A LOT more than that per month, and the place was appreciating. It really was a win-win scenario.
Fast forward 7 years after we first put pen to paper to buy that condo. The condo had appreciated from $300,000 to $520,000 and we had paid down $20,000 in our mortgage there. When you add that up, that's $240,000 in value. Our $60,000 investment had just returned us $300,000! That's a $240,000 gain — 400% return on investment in 7 years.
Remember that RESP we started at the same time? We had maxed out our contributions ($17,500) and maxed out the government grants. The grand total of those savings? A whopping $27,000. 54% return on investment over 7 years. At this pace with our RESP, we wouldn't have enough money to fund our daughter's education.