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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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Old 02-21-2011, 03:27 PM
jessie01 jessie01 is offline
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Default RESP advice

Need some advice regarding RESP. Ex and I opened an RESP for our daughter in 1999 contributing equally. Ex left us in 2003 and stopped his contributions. Divorce was finalized in 2006, with one of the conditions reading " he shall convey his interest in the RESP" to myself. Once financially stable, I continued with the contributions. He hasn't contributed since 2003.
Now we have a child attending post secondary education and he is saying that he has claim to the RESP. The money paid out for tuition and residence came from the RESP. He feels that this should be his contribution. So far he has not paid anything other than his regular CS even though he states he would like to pay.
Anyone have any thoughts or advice on this?
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Old 02-21-2011, 03:39 PM
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He should be 'credited' for half all (both of yours) contributions when you were together (1999 to 2003), plus the growth of that portion. You would be 'credited' with the rest.

I am not sure why the RESP was to be assigned to you as per the separation agreement - if this was for equalization purposes, then what I said above may not apply. If it was simply for control purposes, then I would say what I said is still valid.

It seems that normally, the parents pay for 2/3 of the childs education (including living expenses etc). The 2/3 is divided between the parents in proportion to income.

That is how you should be handling it in my opinion.

On a side note, something that I have never seen here is how to determine the parents income proportions - to me it does not seem reasonable to do it based on the most recent year, but rather the average income of the parents since separation. This is because people don't usually pay for the education out of one years income, but rather usually save up over a period of time (as you have done), or borrow against their equity (same thing).

Second, if the parents split near or during the child attending post secondary, it may make even more sense to divide the 2/3 costs evenly since as I said before this should have been saved over the previous years and therefore both parents will have received half those savings (or equity) when they separated.

I'm sure there is a formula that one could come up with that deals with these concepts such that there is no arguing. But lawyers (and most people) suck at math, especially when they come out on the paying more side.

Last edited by billm; 02-21-2011 at 03:42 PM.
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Old 02-21-2011, 03:50 PM
jessie01 jessie01 is offline
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Thanks Billm,

I was of the same thought with the division of the RESP, giving him credit for actual money he put towards the fund. He isn't happy with that.

Also to make muddy the waters even more, the ex wants the division of post secondary cost to be the following: 33% child and of the remaining 66 % he wants it divided three ways between myself (mom), my husband (step dad) and himself. So in reality he is paying less than his daughter.

Any thoughts on this?

Just for info purposes, ex and I make the same amount. Step dad makes less

Last edited by jessie01; 02-21-2011 at 04:01 PM. Reason: more info
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Old 02-21-2011, 03:56 PM
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Your husband has ZERO to do with the calculations.

33% - child

66% you and your ex, split proportional to income.

RESP valuation aside, the above is the most commonly accepted formula.
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Old 02-22-2011, 12:42 AM
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Quote:
Originally Posted by jessie01 View Post
...
I was of the same thought with the division of the RESP, giving him credit for actual money he put towards the fund. He isn't happy with that.

...
I said half of ALL contributions while you were together, I did not say 'actual money he put towards the fund'.

What do you mean by 'actual money he put towards the fund'?
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Old 02-22-2011, 09:50 PM
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To BillM,
In essence we agree. Half of ALL contributions while we were together is what I'm willing to give him credit for.
The ex is trying to say that I should have put some money from CS towards the fund up to and including this month on his behalf. So in his mind he was contributing and has claim to half of the full amount of the fund.
I have been able to secure bank statements for the funds so there is no argument of the amounts invested from 1999-2003 and then the amounts from 2003 to present.
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Old 02-22-2011, 11:53 PM
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CS does not cover post secondary school costs, so he is wrong.
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