Comments on: Paying for College or Saving for Retirement: The Generation X Balancing Act

By: financial professional

financial professional — Mon, 09 Aug 2010 08:37:53 +0000

To put it even more simple. If you “could” put away “would” you?…I think most if not all would say yes. If you are unable then there are numerous options available, that’s not the question. I think there are a lot of people who default to “I need to take care of myself first” duh…when I counsel clients I go in this order. Retirement, life insurance THEN education.

By: ATVs for Sale

ATVs for Sale — Wed, 23 Sep 2009 21:14:54 +0000

Interesting article. I am still quite young. So I have not saved much for retirement yet. Still I realize that it helps to start saving early. I have had to pay off student loans, but luckily I had financial support from my parents. It must be quite tough for those who have to pay for all college expenses on their own.

By: Konrad

Konrad — Thu, 17 Sep 2009 23:06:25 +0000

This is one of the main reasons that I use a Roth IRA – I can save for both retirement and education at the same time and then as my daughters get older make decisions about how much can go to education based on schools, scholarships, and retirement needs.

By: ctreit

ctreit — Thu, 17 Sep 2009 10:13:31 +0000

I agree with David who refers to Suze Orman. I am a parent, I love my children, but I have to make sure that I will be ok in retirement before I makes sure that I can pay for college. I certainly do not want to become a burden on my children when I am a very poor old man.

I also question the value of a college education. It is not like a bachelor’s degree is the ticket to a good job these days. Maybe it is better to learn a solid trade which can also lead to a fulfilled and prosperous life. Just think about how hard it is to find good craftsmen these days?

By: newretirement.com

newretirement.com — Wed, 16 Sep 2009 20:34:13 +0000

Younger families are focusing equally on retirement planning and paying for college education while older families put more emphasis on retirement planning according to an edward jones report from about two weeks ago.

By: micki

micki — Wed, 16 Sep 2009 17:57:23 +0000

options that no one has mentioned: help them go thru a tech school, after which they can be earning money and socking some of that away to get a college education. or have them join the armed forces which have the GI bill (and if you join the navy or the air force, less chance of getting shot). not an option for everyone, i know, but these are workable options. at this point in time the chances for a locked and loaded career are dwindling anyway and fewer and fewer people are working for any company long-term, or even in the same career field. that’s just life in the 21st century. They will gain skills from having to put themselves thru college. they will value it more when they are the ones making the effort to put themselves thru college.

i paid for my own college. i worked the whole time i went, sometimes more than one job. this took a tremendous burden off my parents who then spent $15K for my sister to go to Syracuse for a year before she quit. but i had no guilt when i decided not to be an engineer (my dad’s dream, not mine) and did a different major. i had no guilt when i decided to quit school to join the navy and become a linguist. i did not take any loans. i had no school debt when i quit and the navy gave me the GI bill, which would have allowed me to finish school had i had the opportunity to take advantage of it (another story for another time).

there are options for our kids that don’t include them having to foot the bill to take care of us when we are old. (my mom did not save ANY money, is dependent on ssdi right now and needs my help just to have a somewhat decent life (shelter, food etc)…so just remember that when it comes time to choose between your retirement and sending your kids to college. help them not have to support you in your old age

By: Daron

Daron — Wed, 16 Sep 2009 16:15:55 +0000

Let’s not overcomplicate this. We have to take care of ourselves, and then we can take care of our kids (note the airline reminder: if the air mask falls, put it on you first, then the kid; we have to be able to help them to actually help them).

I married late to a woman with teenage twins. She had no savings for them; obviously I did not, either. We got ourselves established financially about the time they were planning to go to college. We said we could pay $4000 a year each, but no more. They needed to make decisions around that. It turned out one got a track scholarship and needs little or no money from us. Who could have reasonably predicted that? The other elected to go to a junior college with expenses around $8000 a year. She realizes she can make this in summer jobs while living at home. It gets a bit more interesting the last two years of college when a state school (Texas) costs around $15,000 a year. She’ll have to work during the school year and maybe take out a loan or two; I’m committed to her graduating with little or no debt, a decent degree, and a decent car. Nothing more.

Moral here? It’s pretty simple. Be honest with them, protect yourself first, provide guidance and education to them, and hope they make the right decisions. In college it’s time to grow up, and they are. So far we are proud of them, and our financial help is just enough for them to know they don’t need to worry but they do need to work and be diligent. Not bad life lessons.

By: David@DINKS Finance

David@DINKS Finance — Wed, 16 Sep 2009 15:42:30 +0000

Suze Orman made a great point about this. She said you need to save for retirement before helping your child save for college because that child has their whole life to make money and invest, but your time horizon is getting smaller and smaller.

So instead of saving for your child’s college education, first make sure you are stashing away for your retirement. Your time horizon is getting too short to risk not doing so!

By: C in DC

C in DC — Wed, 16 Sep 2009 14:44:35 +0000

Also, if need be, you can borrow against your retirement funds for college but not the other way around.

By: MoneyEnergy

MoneyEnergy — Wed, 16 Sep 2009 04:18:24 +0000

A couple of other “middle-road” options: you don’t need to be able to pay for ALL of your child’s/childrens’ tuition. You can just chip in what you can *while* they attend. And also, it must be said, not everyone is even meant to go to college or university. Don’t force or expect that your child should do this. A two-year diploma program can get your child started well on a path that might be more fulfilling for them, anyway, and will definitely have them working sooner and in less debt. It’s not even always about having the best grades. Your kid could be an A student yet still benefit more from a community college program where they can become independent much sooner than through a traditional university.