What? Parents should not save money to pay for their children's college educations?
That's right, according to a New York Times article*. Not only is it almost impossible for even the thriftiest families to keep up with the galloping pace of annual tuition increases, saving for college simply no longer makes the economic sense it once did. Saving money in your child's name simply adds assets for consideration by the financial aid officers (read: less aid). It also doesn't make sense to deplete your retirement funds to send children to college. The article below shows the impact of taking money from retirement savings. Bottom line, the result is that your retirement savings are depleted and, because you're close to retirement, there is no time to replenish them.
What's the answer? Like most things, a combination of strategies works best: in addition to student aid, you should consider student loans before you deplete your retirement savings.
Loan to Learn® can be an integral part of this winning strategy. Our affordable, credit-based student loans provide the wherewithal needed to pay for college, even as you maintain your family's accustomed lifestyle and plan for a secure and prosperous retirement.
*“Today's Lesson: Rethink College Funds” by Damon Darlin, The New York Times, Saturday, September 24, 2005.