When I initiated my son's RESP, I decided to set up a monthly contribution which went to a special RESP mutual fund. This fund, the RBC Target 2020 Education Fund, is designed to gradually shift from a heavy (high-growth) equity exposure to a more conservative asset allocation as a child nears his graduation date. It carries an MER of 2.08%.
This week I changed my monthly contribution to four separate RBC Index funds which should replicate the Target Education Fund's performance - at a much lower cost. The RESP's MER is now 0.74%. Consequently, our returns should now be 1.34% higher. Not bad, eh?
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