A new study prepared for the federal Ministry of Human Resources and Social Development has dished scathing criticisms on group scholarship funds, reported the Globe and Mail Friday. The criticisms suggest that parents should be wary when considering this type of RESP to save for their child’s education.
The report prepared by Infometrica found that parents lose money on group scholarship funds if they pull out before the fund matures, because of high upfront fees that aren’t always properly disclosed. Users have also complained about not being able to transfer their investment between plans and about not being able to get certain courses recognized as qualifying for payments to their child.
To learn more about RESPs, visit the new OnCampus Student Finance section.
To read more about the report’s recommendations, click here.