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Saving For College or
Retirement?
College for the kids or retirement for you? Which goal
has the highest importance? Or can you possibly save for both? These are a
couple of the most frequently asked questions of financial planners.
First off, don’t be too hard on yourself about your money management. It
is very difficult to accomplish either one of these goals, let alone both. The
purchasing power, the company pension plans, the increase of education and
starting families earlier play a huge part in such difficulties.
Your
retirement should have a priority in your own life. Let your children go to a
high-priced four-year private school if you wish, and give them the gift of
learning to use their money wisely by paying for it themselves. Look at it this
way, if you spend your money on college, then a few years of your retirement
savings will be gone. Your social security may not be enough to make ends
meet.
Just ask my 90-year-old great aunt how far her $638 Social
Security check stretches each month!
The best thing to do for your
family is to stay financially strong, and put your retirement first. It may
sound selfish, but it is truly the best strategy for your family overall.
If you want to try to save for both, here’s some advice. Start
while your children are young, and set up a bank account for them. Many
financial planners recommend that children set aside 25% of their earnings into
this bank account. This could be money earned from chores, good grades or even
holiday gifts. When the child reaches high school age, then they can start a
part-time job and supply that percentage through their earnings. This will not
only help save money for college, but it will help teach your children
important economic lessons.
So again, pay attention to your future
first and your children will appreciate it in the long run. Your children will
need you throughout their life far more than your money. The protection of your
finances will ensure an independent retirement and leave no burden on future
generations.
Article written by Vic Bilson
Vic recommends
Dynamic Financial Training that is all about helping others
to help themselves and then turn around and help others. At DFT we believe that
if we teach a person to get out of debt, they will stay out of debt for the
rest of their lives AND so will the next generation of their family.
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