Have kids? Chances are, they're thinking about college And they may want you to help them pay for it. At some point, you may even be tempted to do so, tapping into your retirement account or reducing your future contributions to help them pay for tuition. Yet doing so puts your retirement savings at risk.
To borrow a phrase from the aviation industry: put your oxygen mask on before helping others. Who is going to help you out once you retire?
There are more ways to help your children through life than by giving them your retirement money for college tuition. If you still have time on your side, consider opening a 529 plan for your son or daughter. Encourage them to start as early as possible and look into all grants, scholarships and federal student loans before turning to private loans. They could also consider starting at a community college and then transferring to a four-year program.
Your kids have choices when it comes to their post-high school education. However, your retirement income is dependent on what you put into it. Being financially secure is the best gift you can give your children, as it allows them to make decisions knowing you're taken care of financially. Once your retirement finances are secure, you can help them pay back student loans, or assist in other ways (finance a family vacation!).
Whether you've just started your first job or you're just around the corner from retiring, BECU can help you create a personal retirement plan portfolio. We'll help identify your funding resources, develop a savings and investment plan and tailor investments to help produce the levels of income you'll need. Visit BECU.org for more information.