This was written a while ago, 2015. Back then I was attempting to cash out TD E-series Index Funds in my kids’ RESPs. Using the TD E-series RESP method is good, but fraught with gotchas.
Just when I thought I couldn’t possibly find anything more to write about with my kids’ RESP account, TD puts a beartrap in the process and I end up with yet another article to write, about the TD E-series RESP mutual fund account, and how it is not a straight-forward process cashing out.
Is this another rehash about a visit to my local TD Branch to cash out my TD E-series RESP funds? Yes, and no (after a fashion).
Four months ago, when I changed all of my TD Mutual Fund savings vehicles, into accounts that allow for the purchase of the TD E-series Index Funds. Remember I did outline in Quicken and transferring E-series Index Funds, how to change from the I-series funds to the E-series versions (which have lower MER fees), little did I know that with that change, I set the beartrap, that I stepped on Friday evening.
I went to my local branch of TD Friday because my youngest daughter’s tuition fees were due. An appointment was set up at my branch last week, to get what I needed to pay for this term. You must go to a branch to prove your child is in a reputable program, before you can have access to the RESP funds. I had my letter, I knew what part of the portfolio I wanted to liquidate, so what could go wrong?
Upon arrival at the branch, and I was dealing with a polite young man, that I had dealt with previously. I explained quickly what I wanted, and he logged in and started clicking and typing. Time passed, screens seem to fly by and then return and I started to wonder, “What is wrong?”.
After about 10 minutes the gentleman turned to me and said, “We have a problem here”. At that moment, the bear trap snapped shut on my ankle.
The “Advisor” then explained that the in-branch Financial Advisor/Mutual Fund persons are not allowed to touch E-series funds. I believe my response was a confused but polite, “I beg your pardon?”. The young man went on to explain that he could only trade the I series funds. The TD E-series RESP funds were out of his “jurisdiction”.
At that moment I almost asked, “So I have a Save only account?” (i.e. I am allowed to put money in, but not allowed to take any money out). There is a methodology to take money out of a TD Mutual Fund account with E-series Index Funds.
Steps to Withdraw Funds
- Get a proof of enrollment letter from the post secondary school she is attending. Luckily I already had that from September
- Make an appointment with the local branch to do an RESP withdrawal. This is so someone trusted at TD can attest to the letter that you got in the first place (hint for TD, maybe I could have the letter sent to YOU or faxed?).
- Go on-line to my TD Mutual Fund account, and move the funds I want, into a TD Money Market account. This is a fund that the Mutual Fund expert or Financial Advisor can do something with. Do this at least 2 days before you go to the branch (to allow the transaction to go through).
- Go into the branch and spend 1/2 an hour answering questions, and possibly having to review your investing profile, but eventually put through the transactions to cash in the funds you want.
- Wait for the funds to arrive on-line
As an epilogue to Friday, I also asked what would happen if my RESP was with TD Waterhouse (in hindsight what I should have done in the first place)? It becomes more complicated, and at the end of your visit to the local branch, you must then wait for TD Waterhouse to release the funds to you (so you need to wait longer for it).
I must now return this Wednesday to attempt the same thing I attempted back on Friday (i.e. cash out my TD E-series RESP mutual fund account).