As you sit down and plan your finances you may be wondering if your retirement or paying for your children’s college is more important. You feel that you want to help your children out as much as you can, and you want to make sure that they have the best start they can in life. At the same time you worry about your retirement. You want to be able to retire comfortably without too much worry about your finances in your later years. This difficult decision is one that many parents have to make. While it is important to help your children out if you can, it is more important to plan for your retirement. Here are four things to think about when making this decision:
1) Your children have alternative ways available to finance their education. Your children may qualify for scholarships and grants. They can get a part-time job to help them through school. If necessary they can take out loans to pay for an education.
2) If you do not plan for your retirement you will become a burden to your children. They may become resentful of this. It can cause stress on you’re their marriages. I have never heard anyone who was bitter about needing to put themselves through school. I have heard many children worry more about their elderly parents and how they can help them out.
3) You need to make sure that you do not rely solely on social security or on a pension plan. These are changing and may be a lot less than you have planned on. The qualifying age for social security is increasing each year, and the amount you receive is decreasing. As life expectancy grows longer the benefits are being stretched further.
4) You may be able to provide partial help for your children while still saving aggressively for your retirement. If you begin planning and saving early this will be easier to do as college approaches. It is also important to realize that you do not need to provide everything for them once they are adults.
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