Prioritizing Savings–Don’t Tell the Kids

We all have to prioritize-our time, our work, our lives, our savings.  The Wall Street Journal ran an article on November 5, 2013 by Lisa Ward on prioritizing savings between retirement and college for the kids.  Titled Save for Retirement—or College?  the article offers advice from experts, with one suggestion of saving for retirement over college (did that surprise you?) since there are alternatives to financing a college education that don’t exist for financing retirement.  Really? Well, “[s]aving is the primary way you can fund your retirement, especially if Social Security is unlikely to replace a significant portion of lost income and you aren’t entitled to a big company pension.” One of the experts described it this way: “‘Unless your retirement plan is for your children to take care of you, retirement funding must come before education funding…'”

 However, this doesn’t mean you should skip save for your kid’s education-instead the experts suggest starting early since it will be a smaller hit to your budget if you do (and leaving you more to put away for retirement). The article also discusses ways to save taxes, 529 plans and other savings vehicles.