Saving For College & Retirement Planning In Tandem
Welcome to the Wealth Curve Talk Podcast. In this episode, John continues his series on the Wealth Curve Blueprint. This time he discusses saving for college and how that fits into your overall wealth plan.
John is the author of 5 Ways Your Wealth is Under Attack. He has lectured on financial planning at various faculties. He has also received the Five StarSM Wealth Manager Award for 2011, 2012, 2013, 2014, 2015 and 2016.
John’s strength is his ability and commitment to improve the level and quality of the financial planning process.
His dedication to his clients’ growth involves an evolving strategy. His focus is to meet the demands, desires, and needs of his clients in a changing economic environment.
John’s key takeaways from this episode:
- If your financial plan includes paying for all or part of your kids’ college, the time to think about that is now.
- If your kids are teenagers—let’s say a year out—it could cost $250,000 per kid in today’s dollars. That means you need the majority of that cost to be funded right now. Otherwise, you will need to be able to pay for it out of cash flow or with student loans.
- If your children are younger, plan for it to cost somewhere between $40,000 and $70,000-plus per year in today’s dollars, which will go up 2% and 5% a year—inflation adjusted.
- Make sure you put away enough money every single year, and that it is spread among different vehicles. Then factor in inflation and the growth rate.
- Don’t forget your retirement goals: make sure that as you save for college you can still put away enough money for retirement to sustain the lifestyle you want.
When we build your Wealth Curve Blueprint we ask, “What percentage of your college goal do you already have covered? Are you saving the right amount of money? What vehicles are you using so that if college ends up being free, you won’t have to pay loads of unnecessary taxes and fees to get your money back?”
Let’s build a Blueprint and Scorecard and let’s look at your college savings along with your retirement savings. For more, listen above.
If you are new to Smallwood Wealth schedule a Wealth Curve Conversation here.
Or call us at 732-542-1565.