First Person: I Won't Pay for College With Retirement Funds

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College is going to be expensive. There is just no way around that reality. Still, I am committed to helping my kids get through higher education. It is more than job training and preparing for a career. A college education is about cognitive development and becoming a critical thinker in a complex world. Therefore, I am willing to make financial sacrifices in order to help my children afford school. However, I probably won't pursue one particular course of action. I most likely will not dip into my retirement funds, even if that is becoming a trend for some people.

A pattern of saving

Ever since my children were born, I have been saving for their college education. This saving has been a dedicated pattern of monthly contributions into mutual funds. I have utilized a combination of Coverdell ESAs and 529 plans in order to plan for this challenging expense. It hasn't always been easy to make these monthly contributions, but saving is about discipline and dedication. I think there are a lot of people out there that have good intentions about saving, but they don't put it into practice and develop a habit.

A little bit of debt

Whether there will be enough money for college is yet to be determined. Affordability will depend on the chosen institution, scholarships and the performance of the college funds. The unfortunate challenge is that there may not be enough money once the time comes, but I still don't want to dip into my retirement funds. I would prefer that my children avoid stacking up loans, but having a reasonable amount of debt can represent an opportunity for financial learning.

Do not touch

A retirement fund is not just another savings account. Obviously college is an important expense, so I can understand why some people will dip into their 401(k). However, I hope people do this with extreme caution. I would rather save for retirement and help my children with debt and other obligations later in life rather than miss out on an opportunity to maximize savings over several decades. It is one thing if a child gets sick and a family has to dip into savings in order to pay for medical expenses. College is not the same type of financial obligation.

College is extremely important, but the 401(k) is not the best way to fund it.

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