Dear Kim,
My husband and I recently sat down together for dinner (a bit of a rare occurrence). We have two children who are both heavily involved in sports, so it feels like we mostly see each other in passing these days. It was a lovely, peaceful meal, and we got to talking about the future.
We love our hectic life, and our children more than words, but admittedly we look forward to quieter days too. At dinner, we dreamed about what retirement would look like, what we want to do once we have free time again, but then we realized that any plans we make cut into what we can help our children out with down the line.
I guess we’re feeling a little guilty dreaming. Our youngest is in eighth grade and our oldest is a sophomore in high school. We have some money set aside for their college funds, but how can we balance funding our retirement and ensuring our children’s education doesn’t suffer?
Sincerely,
Retirement vs. Education Dilemma
Dear Dilemna,
As parents, we want to ensure our children have the best we can offer them, sometimes to our own detriment. How much are you putting away for your retirement as opposed to how much you are saving for your children’s education? The greater amounts should be going into your retirement accounts. It is all well and good to wish you could pay for your children’s education in full, but that isn’t realistic for most of us. If you live in the state of Tennessee, your children can get their first two years paid for by the state. A lot of kids don’t want to go to a community college, but it’s hard to say no to free schooling. They might also consider taking AP classes in high school, which will reduce the number of classes they have to take and pay for once they get into college.
Many kids are choosing to go into a trade as opposed to getting a 4-year degree, and those jobs can pay very well. I would sit down with your children and begin asking what they think their interests are and what they think they might like to do once they get out on their own.
Have you and your husband decided when you might like to retire? If you have that date in mind, you can begin to plan how much you need to save each year to be able to support yourselves at that time. I would encourage you to set aside regular date nights so you can continue this conversation, and just enjoy each other’s company. Too often, when your lives revolve around the kids and their activities, you find a distance growing between you and your spouse. When the kids leave, you don’t have the relationship you once did.
Working with a financial planner can help you set goals and assign dollar amounts to those goals. I wish you the best of luck.
Kim
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