Kaleido RESP Review: Is It Worth It?
Kaleido RESP Review Rating: 3/5
Kaleido is one of the specialized RESP providers out there that has been in existence since 1964.
But is it worth saving your child’s post-secondary education with them?
This review covers everything you need to know about Kaleido RESP to make an informed decision.
Overview of Kaleido RESP
| Year launched | 1964 |
| Promoter | The Kaleido Foundation |
| Investment Fund Manager | Kaleido Growth Inc. |
| Custodian | CIBC Mellon Trust Company |
| Portfolio Managers | Fiera Capital Corporation, AlphaFixe Capital Inc., and Montrusco Bolton Investments Inc |
| Insurer | Canada Deposit Insurance Corporation (CDIC) |
Kaleido (formerly Universitas) is a Quebec-based RESP account provider that prides itself as a pioneer of registered education savings having been founded in 1964.
The company provides customized RESP accounts and invests them in securities that meet environmental, social, and governance (ESG) criteria.
Kaleido partners with reputable organizations to manage and hold your funds, providing maximum security.
How Kaleido RESP Works
Kaleido RESP works like other RESPs out there.
When you open an RESP account at Kaleido, you can save for your child’s post-secondary education which will attract you:
- Up to $7,200 grant from the government under the Canada Education Savings Grant (CESG)
- Up to $2,000 per eligible child under the Canada Learning Bond (CLB)
- Other benefits depending on your province or territory
Kaleido will use the funds in your RESP account and invest them in sustainable and ESG-friendly securities.
The portfolio manager will adjust your investment as your child approaches post-secondary age according to the plan you chose.
There are three plans to choose from: IDEO+ Conservative, IDEO+ Adaptive, and IDEO+ Responsible.
In return, Kaleido will make Educational Assistance Payments (EAP) for post-secondary studies to or on behalf of the child you registered for the program.
If your child didn’t pursue post-secondary studies, you will regain your contributions subject to your investment risk level and applicable charges. The government grants will also be returned.
Kaleido RESP Plans
As noted earlier, Kaleido allows you to save for your child’s post-secondary education through any of its three individual plans:
- IDEO+ Conservative
- IDEO+ Adaptive
- IDEO+ Responsible
The individual plans were introduced in 2022 to allow you to assign only one beneficiary per RESP account who does not have to be related to you.
Below we shall look at each of Kaleido RESP’s plans, their investment objectives and strategies.
IDEO+ Conservative Plan
This plan is tailored to those looking to save for their children’s post-secondary studies through a low-risk RESP account.
The plan seeks to provide appropriate capital growth and income by investing in long-term investment securities.
Other key features of the plan include:
- Variable return potential
- Conservative and adaptive investment strategy
- Sustainable Investment Policy
- Flexible contribution (no initial minimum contribution and you can contribute at your own pace)
- Withdrawal before maturity
The plan invests more in the maximum proportion of variable income securities when your kid is younger and less when they approach the age of 18.
IDEO+ Adaptive Plan
This plan is tailored to investors with moderate risk tolerance looking to save for their children’s post-secondary studies.
The plan also seeks to provide appropriate capital growth and income by investing in long-term investment securities.
Other key features of the Adaptive plan include:
- Adaptive investment strategy
- Variable return potential
- Sustainable Investment Policy
- Flexible contribution (no initial minimum contribution and you can contribute at your own pace)
- Withdrawal before maturity
The plan allocates more funds on the maximum proportion of variable income securities when your kid is younger and less when they approach the age of 18.
IDEO+ Responsible Plan
This plan is also tailored to investors with moderate risk tolerance looking to save for their children’s post-secondary studies.
The plan seeks to generate a positive impact on climate change and the well-being and education of children by investing in long-term investment securities.
Other key features of the plan include:
- Adaptive investment strategy
- Variable return potential
- Beyond Kaleido’s Sustainable Investment Policy
- Flexible contribution (no initial minimum contribution and you can contribute at your own pace)
- Withdrawal before maturity
Like the Adaptive Plan, this plan also allocates more funds on the maximum proportion of variable income securities when your kid is younger and less when they approach the age of 18.
Kaleido RESP Performance
Kaleido IDEO+ plans were launched in 2022, so we have limited returns to evaluate.
Below is a highlight of their 1-year compound annual return as of December 31, 2022:
| Plan | 1-Year Return |
| IDEO+ Conservative | 0.87% |
| IDEO+ Adaptive | 0.92% |
| IDEO+ Responsible | 4.49% |
Except for the Responsive Plan return, the other returns are not impressive compared to their peers.
However, you shouldn’t finalize your decision based on the above returns alone as past returns don’t guarantee future returns.
Kaleido RESP Fees
Kaleido doesn’t charge fees to open an RESP account with it.
However, it charges several other fees which include:
| Type | Amount |
| Administrative fee | 1.65% |
| Portfolio management fee | 0.031% and 0.158% |
| Custodian fee | *0.009% average * $8 per transaction on Canadian and U.S. securities. *$15 per electronic transfer. |
| Transfer to another RESPprovider | $50 per contract |
| Withdrawal of contributions orAIP per cheque | $10 per cheque |
| Cancellation before thebeneficiary turns 17 or is eligiblefor an EAP(with the exception) | $50 per contract |
Other fees the company charges include operating fee, trustee fee, compensation for
Independent Review Committee members among others.
Pros and Cons of Kaleido RESP
Based on the above review, below are the main pros and cons of Kaleido RESP:
Pros
- Free access: Unlike other RESP providers, Kaleido doesn’t charge a fee to open an RESP account with it.
- Flexible contributions: You can contribute to Kaleido RESP at your own pace by depositing the amount you wish and at the time you wish. While there’s no initial minimum initial contribution, the minimum amount per contribution is $10.
- Customized solutions: By using an adaptive investment strategy, Kaleido helps you invest in the right securities that match the current age of your child.
- Family accompanying services: They partner with some companies to provide a range of family services across coaching, family finances, school guidance, academic support, health and wellness.
Cons
- High fees: Kaleido charges different kinds of fees that can easily accumulate and consume a significant part of your investment.
- Limited performance data: While the company has been in business for six decades, its newly launched individual plans don’t have enough data to evaluate and compare their potential even though past returns don’t guarantee future returns.
- Payments not guaranteed: The company doesn’t guarantee that you will qualify to receive payment to fund your child’s post-secondary studies nor guarantee the amount you will receive when the time comes. This could undermine the purpose of the investment at the end of the day.
Kaleido RESP Review Rating Methodology
I rate Kaleido RESP 3 out of 5 stars based on comparative analysis and the rating of the following features:
Rating Methodology
Overall Rating
With the above rating, I can’t recommend Kaleido to those looking for the best RESP provider in Canada.
Kaleido RESP vs Justwealth RESP
| Profile | Kaleido RESP | Justwealth RESP |
| Year founded | 1964 | 2015 |
| Minimum initial deposit | None | None |
| Management fee | 0.031% and 0.158% | 0.5% on the first $500k balance and 0.4% on a balance above $500k |
| Insurer | Canada Deposit Insurance Corporation (CDIC) | Canadian Investor Protection Fund (CIPF) |
Justwealth is a Robo-advisor that is well known for its dedicated RESP account.
Unlike Kaleido, Justwealth manages portfolios using a robot and human advisors. This minimizes risks and reduces investment costs due to limited human intervention.
The award-winning Robo-advisor offers different investment accounts but its RESP account stands out from the rest due to its unique features and impressive performance.
Through Education Target Date Portfolios, Justwealth provides customized investment solutions on RESP accounts according to the age of your child.
As a Robo-advisor, the major fee you will incur at Justwealth is management fee and management expense ratio (MER).
Justwealth doesn’t charge withdrawal fees on RESP accounts. And when you move your RESP account from another institution to RESP up to $25,000, you will get the $150 transfer fee reimbursed.
Overall, Justwealth RESPs are low-cost and better than Kaleido RESPs.
You can learn more about Justwealth RESP here.
Verdict on Kaleido RESP Reviews
As a specialized RESP provider, Kaleido attracts higher expectations than other providers.
Unfortunately, the company doesn’t meet up to expectations on many grounds as of the time of this review.
With high fees and low returns, I can’t recommend Kaleido for your child’s RESP account.
Instead, I recommend you sign up with Justwealth which is the overall best RESP provider in Canada.
Kaleido RESP Review
Summary
I don’t recommend Kaleido to those looking for the best RESP provider in Canada due to its high fees and low returns.
