Kevin M. Hedley

 

Hedley & Company

1593 Route 9, Clifton Park, NY 12065

 

Phone:  518-348-2079

Fax:      518-348-1264

 

Email: accounting@hedleycpa.com

August 2024

Retirement Savings Versus College Savings

For Millennials with young families, this can be a quandary. Try to save for both, but prioritize retirement savings. There are loans for college but not retirement.


SET PRIORITIES
While you value providing higher education for your children, step back and think hard before choosing to fund education over saving for retirement. Alternatively, start your children working toward winning scholarships in their freshman year of high school. Academics and sports are one way, but leadership in clubs and community service are also important.


MAXIMIZE EMPLOYER 401(K) MATCHES
A 401(k) plan matching contribution may be the best return you will ever get on an investment. In addition to the match, you also get a tax break on your contributions and the earnings on those contributions. If your employer also offers a Roth 401(k) option, all contributions, including the match, will be made with after-tax money.


CONSIDER A COLLEGE SAVINGS PLAN
Ask your professional advisor about a college savings plan only after you’ve maximized your retirement plan matching contributions. They can help you compare the benefits of saving more in your company plan, contributing to an individual retirement account or Roth IRA, or funding a separate college savings plan.

Previous Next

SUBSCRIBE

Enter your Name and Email address to get
the newsletter delivered to your inbox.

Please include name of person that directed you to my online newsletter so I can thank them personally.


CONTACT US

Enter your Name, Email Address and a short message. We'll respond to you as soon as possible.

The information and opinions contained in this web site are obtained from sources believed to be reliable, but their accuracy cannot be guaranteed. The publishers assume no responsibility for errors and omissions or for any damages resulting from the use of the published information. This web site is published with the understanding that it does not render legal, accounting, financial, or other professional advice. Whole or partial reproduction of this web site is forbidden without the written permission of the publisher.