Then you will be saving roughly 0 taxes per year (assume 40% rate on 3% interest).
The interest portion of the account will be taxable in the child’s hand when withdrawn but as long as they are in a lower tax bracket then you will save some tax money.
I am divorced and we had to liquify our RESP 12 years ago.
Since then their father had passed and left a little insurance money.
If she doesn’t want to contribute the maximum then I would suggest contributing a minimum of ,000 this year otherwise this will be the last year the child will be eligible for grants.
If I were in Donna’s shoes I would make sure first and foremost that I didn’t invest in anything with any risk at all (resp or not) – there just isn’t very much time until this educational money is needed.
Secondly, I would definitely open an resp for the 15 year old because there is a lot of potential grant money available.
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