It’s a really common question and one that tugs at the heartstrings. Should I save more for my retirement or more for my kids’ college?
Hint-Remember Put Your Mask on First!
Our retirement or their college? Remember, SAFETY FIRST!
You’re just about to take off to the trip of your dreams, and the flight attendant comes on and goes through the safety procedures. You hear-put your mask on first, and then assist others. Did you know that was some of the best financial advice?
Okay, we may be stretching this a bit; however, it really hits home-this idea of taking care of your financial situation before assisting others with their financial situation.
- Is it a battle?
- Your mask first
- Retirement Solutions
- College Solutions
- Final Word
Is it a battle?
Yes, it is a battle because we want to save more for retirement and at the same time more for our kids’ college!
We know what you’re thinking, this is a waste, it’s not a battle for me. News flash, if you’ve had to decide how much to put towards your kids’ college savings it has been a battle. Why, because you made the choice to put money towards their college and not your personal retirement or other financial goals. If you have a significant other it also might be a battle because you both may not be on the same page. (hint hint, we feel you on this one!). We are here to help you through this challenging battle and to confirm there can be two winners (hooray!).
Your mask first.
Save more for retirement.
It’s a simple statement, your mask first, period. Restated, save more for your retirement before saving more for your kids’ college. You are going to tell me but, I don’t want my child to have debt from school. But I don’t want them to have to pick between going to school and not getting educated. But I don’t want them to not be able to, BUT BUT BUT. And my heart hears you, it’s a battle between your heart and your brain. Just remember safety first and your mask HAS to be on and functioning for you to even be able to attempt to assist another. By no means are we saying not to save for your kids’ college, we are just saying to make sure your financial/retirement “mask” is SECURE and properly functioning before funding someone else’s.
If you are curious on options to save for retirement, check out our blog-All Things 401(k)
Retirement Solutions.
Still not convinced? Let’s say you chose to fund your kids’ college and didn’t check to make sure your retirement was fully funded first. Fast forward to your retirement years. Your kid is happy, they have no tuition (woohoo), so that makes you happy. You are ready to retire, until you realize you haven’t saved enough (less woohoo).
What other solution is there to fund your retirement expenses? This is the hard truth, there ISN’T one. Your retirement savings is on YOU! No one else will fund it for you. So, should you save more for your retirement or for your kids’ college?
College Solutions.
You can still help with your kids’ college!
So let’s replay that scenario. You chose to fund your retirement fully and unfortunately it didn’t leave much left to fund their college. They get to college and have to take out massive amounts of loans (bummer). However, you are ready to retire and realize you can do it comfortably! In fact so comfortably you have extra money to send their way monthly to support them while they are in college or to help pay down their loans. Or maybe, you’ve built quite a bit of equity into your home and can utilize that to help pay for college.
When kids get to the point of going to college there are solutions to help fund their goals. Loans are not ideal; however, they still have the option to attend. You on the other hand would have no other option than to reduce your retirement dreams and just live with the basics. Or worse yet, your only option could be to work longer if your retirement wasn’t funded.
Save more for retirement or kids’ college?
Final Thoughts.
We know your mask is important; however, we know your kids’ mask is equally important if not more (depending on which parent you’re talking to). We do believe there can be a middle ground between saving for yourself and for your kids. Our job is to help you understand if your mask is on properly and is functioning for your needs and then our second job is to understand how to put on your kids’ college masks as well.
At the end of the day there is no secret on what to do, we just have to find balance and understand the risks and rewards at play. So please, bring that battle to our battle field and we will help position your masks!