Some people are torn on whether they should reduce retirement savings to save for their children's college. Here are 7 reasons why retirement should be your first priority.
Pay yourself first!
- Ensure you have properly funded an emergency fund (3-6 months of expenses)
- As a CERTIFIED FINANCIAL PLANNER™, I recommend you save 10-15% of your income to sufficiently prepare yourself for retirement
- It used to be 10% threshold, but as people are living longer, healthcare costs are rising, and social security benefits are being reduced
- This leaves more responsibility on us to save than ever before
- Remember, loans are available for college, not for retirement
- Potential Match
- Your employer match is free money – take advantage, if available
- Deferring a percentage instead of flat dollar amount will allow your deferral amount to increase or decrease with your income
- Qualified Tuition Program - 529 accounts
- State income tax deduction
- Expanded qualified expenses to include up to $10,000 paid toward student loans
- State income tax deduction
Please contact our office today if you have questions on your retirement and/or college savings plan.