Your children are your life — and we’re okay with that. In fact, the children that mean the most to us are part of our lives too. It’s funny, the things you will do for your kids. Children and finances go hand in hand, but we often find ourselves worried about the future regardless. We want to send our children off to the best schools, but we also want to make sure that we can retire someday and not have to go into a job.
So the question is simple — do we focus on our retirement, or do we focus on our children’s education? Of course, upon asking you this chances are good that you would tell us that the situation is really not as cut and dried as we’re making it out to be.
You see, tuition is not going to be cheap. Even if you live in the UK and your young student can go off to university without paying a lot of money, there are still going to be expenses. Room and board is one expense, and clothing, transportation, textbooks and other fees are another entirely. A computer — specifically, a laptop — makes things a lot easier as well. If you’re not willing to push forward and at least take care of your own needs, you’re going to feel resentful in the long run.
This is because retirement savings are a lot harder to replace than educational ones. Believe it or not, your child is going to have access to a lot of financial aid. Yes, they will have to make sure that they have good grades for merit-based aid, but financial-based aid is all about income. It’s all about enabling students to reach their highest potential even when they don’t have the money to do so. That’s the real backbone of any society after all — educated professionals and skilled workers. The power of seeing your children go on to really take on a great career can be worth it in the long run — and that’s something that we will not downplay in the least.
The best thing that you can do is make sure that you have an honest conversation with your children. Let them know what you can and cannot do. It’s cliche, but this is definitely a case where honesty is the best policy. If they think that you’re going to pay for everything, they might not take the time to look for the right amount of financial aid. This can lead to disaster in ways that are hard to realize, so you need to make sure that you really do need your eye on the prize of retirement. When you are safe and secure, it’s also easier to help your children. You don’t want to find that you’re not able to get things done because you poured every last penny into your child’s education. On the flip side, you also don’t want to be selfish to the point where you put a wedge between you and your children. Your children are forever, and again — some people feel that it’s more than worth it to make sure that their kids are taken care of. It’s your world — define it in the way that makes the most sense for you!
Of course, even though we’re presenting the logical side, the emotional side cannot be ignored. You’re going to want to help your children even if it’s not the most logical thing to do. We don’t blame you for that, and if that’s what you want to do — we support that decision, too.
From a completely logical and financial basis, we think that putting your retirement as a top priority is a good thing. It’s just like paying off your mortgage — there’s no reason that you can’t take out an equity loan later on to help with your child’s education. It would still let you keep your home and you also get to make sure that your students are taken care of properly.
Now is the time to sit down with your financial blueprint and figure out what’s best for you. After all, the only thing that we can do is just give you general advice. It’s up to you to look at your financial goals and your children’s habits and see what will work out the best in your own situation. Why not start today? Good luck!