Leeann: Our son will be a freshman in college next fall and will probably be going to school out of state, which we didn’t expect. We and his grandparents have put money into a 529 plan for him, but this will only cover a portion. Do you have any thoughts on paying for college and/or taking out loans?
This is the season for people to think about paying for college. Student loan debt is going through the roof in this country. If you want to pay for your student’s college, I have a few suggestions. IRAs and Roth IRAs can be used for education as well. If you and your husband are under 59, you know you can not take money out of your IRA without a penalty and will taxed on it. But if you’re taking money out for college and you have an IRA, you will still be taxed for this money but they will waive the penalty. If you have a Roth IRA, which is already tax free, you get those qualified educational expenses without taxes or penalty.
Danger: remember your priorities.
What is most important is that you and husband are prepared for retirement. You should be cautious about digging deep into your retirement plans. I know our kids are the most important thing in the world to us but you will not be doing your kids a favor by putting yourself in a bad situation. If you have to move in with your kids later on in life because you don’t have enough to live on your own, that doesn’t benefit them.
You can take out loans, yourself or your student.
Be cautious though of the level of debt you’re taking.
Be honest with your kid about how much you have saved.
Let them know what you can cover and what you can’t. Give clear boundaries.
What happens when family members’ circumstances change your retirement plans? The number of baby boomers caring for BOTH kids and parents is skyrocketing!
Giving is great but not at the risk of going broke! Ever since “THAT” Christmas, my wife and I have obeyed these 3 parameters.
<Lightning Noise> Today we hit four questions including “How we get paid for our services?” These are YOUR questions answered!
Life happens, and suddenly you have a collection of 401K souvenirs. You aren’t helping yourself by having multiple, small accounts out there. Here are the reasons why & the best thing to do next.
Fear sells and it can be scary powerful. How is fear being used in the financial world? Are you a victim to fear tactics?
Does your plan have an Achilles heel or a fatal flaw that exposes it to extreme risk? Even if it “feels safe” there are no certainties in planning. Here is a better way to live.
<Lightning Noise> Today we’re discussing how to best utilize the equity you’ve saved, how to prioritize paying off loans, and whether or not a severance package is right for you. These are YOUR questions answered!
Let’s talk about the most boring meeting of the year… sounds thrilling, right? But, if you can fight through it… it can make a difference. I believe in you.
Whether we’re throwing money away at the lottery or gambling with the stock market, we all have something in common. Let’s learn a billion dollar lesson.
When you know this much about market timing you’ll be prepared to… never trust market timing again. But thankfully there is a better alternative that will give you full confidence.