BMO Investments has created a series of investment portfolios for registered and non-registered education savings that have specific time horizons. The investments are managed according to the child's year of birth and the date he or she is expected begin post-secondary education.
On Nov. 17, BMO announced the launch of five BMO Target Education Portfolios, with time horizons ranging from immediate income (for those who already drawing down their savings, or who are about to do so) to dates between 2020 to 2035.
The portfolios are made up of mutual funds and/or exchange traded funds (ETFs), and the asset mix is gradually adjusted as the child grows older, moving away from equities and towards fixed income investments as the target end date approaches.
"With these new solutions, we're taking some of the guesswork out of investing so that Canadian parents can rest assured that the investments they're earmarking for their child's post-secondary education are on the right track," says Robert Armstrong, vice president and head of managed solutions at BMO Global Asset Management. "These new portfolios are low in cost and combine our market-leading mutual funds and ETFs, making them an ideal addition to an RESP."