MIND YOUR BUSINESS
failure when they graduate. As they research student loan possibilities, make sure they'll be able to comfortably afford payments once they graduate, and that they're not taking on too much debt.
An easy way to start researching together is to visit College Ave Student Loans and use the configure-it-out tool. Answer a short series of questions regarding how much you'll borrow, how many years of schooling are left, whether you want to make payments during school or not, etc. This shows your child what repayment will look like under each option so you can both be clear on the details and agree on a game plan.
"....the Roth IRA has an exception where you can withdraw your contributions from the account at any time...." and penalty-free for qualified education expenses.
Tip 5: Consider the college savings plan that's best for you.
Consider opening a 529 that allows flexible spending toward higher education. Should your child choose to forgo traditional college education or not require the funds set aside, you can easily change the beneficiary to another child or relative.
If you're skeptical of a 529, consider a Roth IRA if your income limits allow. Although typically used for retirement, the Roth IRA has an exception where you can withdraw your contributions from the account at any time tax- and penalty-free for qualified education expenses. The
The remaining money can be collected in your retirement.
Tip 6: Starting late? Play catch-up.
If saving for retirement has not been a priority, it's time to get aggressive. Pare down costs where possible and take advantage of catch-up contributions. People who are 50 or older can contribute an extra $6,000 to their 401(k) or an extra $1,000 to an IRA this tax year.
Tip 7: Don't become the "bank of Mom and Dad."
You want to help your kids, but once you set the precedent that it's OK for your children to ask for money (or a contribution toward college), they may feel they can frequently approach you later in life for funds. Don't set the tone that you'll always be there to financially support them. You want them to grow wings so they can fly independently (and so you can happily enter retirement and enjoy those golden years).
While you should talk with your child about potential majors and career paths, it's important also to add financial conversations into the mix. For more tips, and to learn more about personalized student loan solutions, visit www.collegeavestudentloans.com.