According to the 2010 Ariel Investments/Charles Schwab Black Investors Survey, African-Americans are more likely to invest in their children's college education as opposed to their own retirement. This happens for many reasons. One reason is because we tend to defer our well-being for the hope of a better future for our kids. Though this sounds like a benevolent plan it may lead you toward the poor house in your golden years. Here are two reasons why investing for your retirement is the best choice.You Can’t Finance Retirement- Colleges, banks, institutions and governments finance college education through grants, scholarships, work-study programs and loans. Your kids can earn a scholarship. Apply for a grant. Secure financial aid. Or, get a loan. You cannot finance your retirement.
You Income Is Limited In Retirement- After graduation, your child’s earning power has unlimited growth potential. In retirement, your income is limited. There is no guarantee that you child will help you out in your golden years the way you did when they were getting educated. It’s likely that when you enter retirement, your child will have a family of their own and they won’t have much extra cash to pay back the favor.
Don’t get me wrong. Investing in your child’s education is a great opportunity, if you can afford it. But, if you have to limited financial resources, securing your retirement is the best choice. The best gifts you can give your children is not having to financially depend on them and teaching them sound financially principles.
Picture found at the http://www.workingfamilyresourcecenter.org/
11 comments:
As Always, you present some serious food for thought with this posting. Unfortunately, I disagree that a parent shouldn't play a role in aiding in the financing of their children's education. I think this has been an unfortunate deviation from what has been fairly consistent advisement. However, I won't argue against anyone developing plans to make retirement possible for themselves should they live to see retirement age.
Thanks for the comment. I really appreciate it. I think parents should invest in their children's education, "if they can afford it." But, if they have limited resources and have to make a choice. They should choose a secure retirement.
You can handle it if your salary is big enough to support both these monthly finances.
Saving for your own retirement is more important than saving for college has the same principle as "paying yourself first" so you should save up on retirement(yourself) first before funding for college.
This is a dilemma to many people. But if I were to choose, I'd rather invest to my child's retirement. I want my son to have a brighter future.
Fine information. Thanks so much, have a good day!
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You can know if you can invest in your retirement. Great post
You can know if you should invest in your retirement or your child's college education. The information is very relevant
This article gives the light in which we can observe the reality. This is very nice one and gives in depth information.
Great blog. All posts have something to learn. Your work is very good and i appreciate you and hoping for some more informative posts.keep writing.
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