Your child’s future success might encourage you to pull out all of the stops when it comes to funding their education, but you still need to take care of yourself.
Saving for retirement or your child’s education is an ongoing debate many parents face throughout their lives, but it’s important to strike a balance between your own financial independence and funding your child’s near or long-term future.
As children get older, the case for putting their education needs first is compelling—especially considering lifetime earnings potential with a bachelor’s degree—but you still need to take care of yourself. Finding the right balance will require thorough planning and making some tough choices, but following these three tips will make the process a little easier:
Determine ‘Real’ College Prices: As you begin to investigate college options, note that there is a big difference between the published price of tuition and fees and the price after grants and scholarships have been applied. The national average ‘net price’ for a public school is $12,272, while the national average net price for a private school is $21,778.
Figure Out What You Can Afford: Create a game plan with a CERTIFIED FINANCIAL PLANNER™ professional that incorporates education and retirement funding with other cash flow needs. The plan should also reveal whether education decisions will saddle young graduates or their families with debt burdens that prevent them from reaching other financial goals.
Set Expectations with Your Child: Once you have a plan in place, it’s important to communicate with your child. Discuss his or her college possibilities and how they match up against your expectations of what you’re able to afford to ensure you’re on the same page when the time comes to make a decision.
About the Retirement Financial Advisor
Robert Pagliarini, PhD, CFP®, EA is passionate about helping retirees build the retirement of their dreams. He has over 26 years of experience as a retirement financial advisor and holds a Ph.D. in retirement planning. In addition, he is a CFP® Ambassador, one of only 50 in the country, and a real fiduciary. His focus is on how to help make retirement portfolios last decades while providing a steady source of income. When he's not helping people plan their retirement, he can be found writing his forthcoming book, The Retirement Myth: Escape Average Retirement & Create a High Performance Retirement. If you would like a second opinion to see if your retirement financial plan will keep you comfortable and secure, contact Robert today.