No Result
View All Result
SUBMIT YOUR ARTICLES
  • Login
Thursday, October 23, 2025
TheAdviserMagazine.com
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal
No Result
View All Result
TheAdviserMagazine.com
No Result
View All Result
Home Financial Planning

Citizens: Parents compromise retirement over college costs

by TheAdviserMagazine
4 months ago
in Financial Planning
Reading Time: 4 mins read
A A
Citizens: Parents compromise retirement over college costs
Share on FacebookShare on TwitterShare on LInkedIn


As tuition and room and board fees continue to rise, college sticker shock has parents reaching for increasingly drastic measures to pay for their children’s school, a survey found. Financial advisors say those decisions could have long-lasting consequences on retirement readiness.

In a recent Citizens Bank survey of more than 1,000 U.S. parents, some 59% said they were confident in their ability to pay for their child’s college education after they were accepted. But that confidence quickly eroded when the first tuition bill arrived, with just 21% of parents saying they felt prepared to handle the expenses.

Rising costs are widening that “confidence gap” as parents confront higher-than-expected expenses, researchers said. In just over a decade, annual college attendance costs have increased by more than 30%, up to an average of $41,000 across public and private schools. 

With typical 529 savings plans falling short of covering all of the costs, a majority of parents (62%) said they are expecting a delay in their retirement as they redirect funds to their child’s education.

READ MORE: How to advise clients on Biden’s SAVE plan before it disappears

Nearly a third of parents surveyed said they borrowed against their 401(k) or liquidated personal funds to help cover college expenses. And just over a quarter reported pausing their investing entirely while their child attended college in order to direct more money toward school fees.

Advising around a ‘crazy notion’

Financial advisors like Michael Gerhard Hausknost, CFP and network member at GLG in Long Beach, California, say the insistence on paying for a child’s college is “crazy.”

“This has been my No. 1 pet peeve about the American investor/parent,” Hausknost said. “This crazy notion that above all they have to pay for their children’s higher education, retirement be damned. I’ve had more arguments with clients about that topic than I care to remember.”

Not all advisors are as impassioned as Hausknost, but they largely agree on the same point: Unlike college, you can’t finance your retirement.

Sarah Avila, a financial advisor at VLP Financial Advisors in Vienna, Virginia, said she usually advises her clients to have their children take out student loans in cases where the parents don’t have enough money to cover the costs.

READ MORE: Two must-have client conversations for college planning: 529s, FAFSA

“We remind clients that they will not be able to take out a loan to fund their retirement,” Avila said. “The parent can help the child pay off the student’s loans later if they can afford to do so without jeopardizing their own retirement.”

Parents eager to help pay for their kids’ college often resort to pausing their own retirement contributions without understanding the long-term implications, advisors say.

“They quietly reduce 401(k) or IRA contributions during their child’s college years, intending it to be temporary,” said Christopher Haigh, founder of Iconoclastic Capital Management in Rochester, New York. “But those pauses often last longer than expected, and the missed compounding is rarely recovered.”

“When a client tells me they are thinking about stopping retirement contributions or borrowing against their 401(k) to help with tuition, I bring them back to the bigger picture,” Haigh added. “We use modeling to show the ripple effect over 10 to 20 years. Often, the client is shocked at how much impact even a two-year pause can have on their retirement date or total nest egg.”

Finding a better way forward

Parents eager to help their children pay for school often have more options available to them than they know, advisors say.

Long before tapping into their own retirement, parents can help their children look for grants and scholarships to help lower the cost of attendance. For remaining costs, advisors generally recommend taking out federal student loans, with repayment split between the child and the parents.

READ MORE: How financial advisors can rein in overzealous retiree spending

Advisors say having some skin in the game makes children take their college education more seriously.

“I’ve seen firsthand how important this is. When I enrolled at a private university, my parents walked me through the financial implications,” said Luke Harder, a financial advisor at Claro Advisors in Boston. “We decided I would take out a Parent PLUS loan, and we’d split the difference. Knowing what my payments would look like after graduation made the cost real — and motivated me to be intentional with my education, career prep and job search. College is a big commitment. Kids need to understand the stakes before they step foot on campus.”

Reflecting on the parents’ role

Advisors say the college conversation with parents is often about more than the financials. For many clients, paying for their children’s education is an essential part of being a good parent.

READ MORE: Parents are struggling to save for both retirement and college

But advisors like Haigh say that’s not necessarily the case.

“Being a good parent does not mean solving every financial hurdle for your child,” he said. “It means modeling strong financial behavior and ensuring that you remain self-sufficient. That is a gift too. You do not have to choose between being a responsible adult and a loving parent. The two should work in harmony, not conflict.”



Source link

Tags: CitizensCollegeCompromiseCostsParentsretirement
ShareTweetShare
Previous Post

10 Money Date Night Ideas That Are Actually Fun (And Cheap!)

Next Post

Going on vacation? Here’s how to keep your home safe

Related Posts

edit post
Shutdown hits breakaway advisors starting RIAs

Shutdown hits breakaway advisors starting RIAs

by TheAdviserMagazine
October 22, 2025
0

With the federal government shutdown moving into its fourth week, compliance experts and industry lawyers say it's derailing breakaway advisors'...

edit post
The 10 best and worst health care funds of the past year

The 10 best and worst health care funds of the past year

by TheAdviserMagazine
October 22, 2025
0

Recent headlines surrounding the health care sector have been dire.Over 100 rural hospitals have closed over the past decade, and...

edit post
*HOT* Sorel Women’s Boots as low as .97, plus more!

*HOT* Sorel Women’s Boots as low as $47.97, plus more!

by TheAdviserMagazine
October 22, 2025
0

Love Sorel boots and shoes? Check out these rare discounts at Nordstrom Rack! Nordstrom Rack is having a huge sale...

edit post
Why RIAs fire a client or turn new business away

Why RIAs fire a client or turn new business away

by TheAdviserMagazine
October 22, 2025
0

This is the 23rd installment in a Financial Planning series by Chief Correspondent Tobias Salinger on how to build a...

edit post
Citi Strata Elite Woes ‘Not an Ongoing Issue’ for New Applicants, Bank Says

Citi Strata Elite Woes ‘Not an Ongoing Issue’ for New Applicants, Bank Says

by TheAdviserMagazine
October 22, 2025
0

New applicants for the Citi Strata Elite℠ Card shouldn’t have to worry about experiencing the same kinds of income-verification headaches...

edit post
Surreal Estate: How Hauntings Affect Home Sales

Surreal Estate: How Hauntings Affect Home Sales

by TheAdviserMagazine
October 22, 2025
0

You visit an open house for a stately old Victorian on a quiet street. It has a wraparound front porch...

Next Post
edit post
Going on vacation? Here’s how to keep your home safe

Going on vacation? Here’s how to keep your home safe

edit post
Coffee Break: OpenAI as The Money Pit

Coffee Break: OpenAI as The Money Pit

  • Trending
  • Comments
  • Latest
edit post
77-year-old popular furniture retailer closes store locations

77-year-old popular furniture retailer closes store locations

October 18, 2025
edit post
Pennsylvania House of Representatives Rejects Update to Child Custody Laws

Pennsylvania House of Representatives Rejects Update to Child Custody Laws

October 7, 2025
edit post
What to Do When a Loved One Dies in North Carolina

What to Do When a Loved One Dies in North Carolina

October 8, 2025
edit post
Probate vs. Non-Probate Assets: What’s the Difference?

Probate vs. Non-Probate Assets: What’s the Difference?

October 17, 2025
edit post
California Attorney Pleads Guilty For Role In 2M Ponzi Scheme

California Attorney Pleads Guilty For Role In $912M Ponzi Scheme

October 15, 2025
edit post
Baby Boomers Are Flocking to This Florida Town — but Not for the Weather

Baby Boomers Are Flocking to This Florida Town — but Not for the Weather

October 9, 2025
edit post
What to look for when eBay (EBAY) reports Q3 2025 earnings results

What to look for when eBay (EBAY) reports Q3 2025 earnings results

0
edit post
NYC mayoral candidates turn on each other in final debate: ‘Zohran, your resume could fit on a cocktail napkin. And, Andrew, your failures could fill a public school library in New York City’

NYC mayoral candidates turn on each other in final debate: ‘Zohran, your resume could fit on a cocktail napkin. And, Andrew, your failures could fill a public school library in New York City’

0
edit post
The Tax Season Switch That Changed Everything

The Tax Season Switch That Changed Everything

0
edit post
Israeli joint venture wins huge Indian army rifle deal

Israeli joint venture wins huge Indian army rifle deal

0
edit post
Here’s which sectors are showing bifurcation

Here’s which sectors are showing bifurcation

0
edit post
La Ethereum Foundation conferma: l’hard fork Fusaka introdurrà un limite massimo di gas per transazione (EIP-7825)

La Ethereum Foundation conferma: l’hard fork Fusaka introdurrà un limite massimo di gas per transazione (EIP-7825)

0
edit post
NYC mayoral candidates turn on each other in final debate: ‘Zohran, your resume could fit on a cocktail napkin. And, Andrew, your failures could fill a public school library in New York City’

NYC mayoral candidates turn on each other in final debate: ‘Zohran, your resume could fit on a cocktail napkin. And, Andrew, your failures could fill a public school library in New York City’

October 23, 2025
edit post
Israeli joint venture wins huge Indian army rifle deal

Israeli joint venture wins huge Indian army rifle deal

October 23, 2025
edit post
Stock Market Today: Dow Jones Index Gains As Tesla Dives On Earnings (Live)

Stock Market Today: Dow Jones Index Gains As Tesla Dives On Earnings (Live)

October 23, 2025
edit post
La Ethereum Foundation conferma: l’hard fork Fusaka introdurrà un limite massimo di gas per transazione (EIP-7825)

La Ethereum Foundation conferma: l’hard fork Fusaka introdurrà un limite massimo di gas per transazione (EIP-7825)

October 23, 2025
edit post
Here’s which sectors are showing bifurcation

Here’s which sectors are showing bifurcation

October 23, 2025
edit post
5 Tips for Auditing Your Expenses and Strengthening Your Finances

5 Tips for Auditing Your Expenses and Strengthening Your Finances

October 23, 2025
The Adviser Magazine

The first and only national digital and print magazine that connects individuals, families, and businesses to Fee-Only financial advisers, accountants, attorneys and college guidance counselors.

CATEGORIES

  • 401k Plans
  • Business
  • College
  • Cryptocurrency
  • Economy
  • Estate Plans
  • Financial Planning
  • Investing
  • IRS & Taxes
  • Legal
  • Market Analysis
  • Markets
  • Medicare
  • Money
  • Personal Finance
  • Social Security
  • Startups
  • Stock Market
  • Trading

LATEST UPDATES

  • NYC mayoral candidates turn on each other in final debate: ‘Zohran, your resume could fit on a cocktail napkin. And, Andrew, your failures could fill a public school library in New York City’
  • Israeli joint venture wins huge Indian army rifle deal
  • Stock Market Today: Dow Jones Index Gains As Tesla Dives On Earnings (Live)
  • Our Great Privacy Policy
  • Terms of Use, Legal Notices & Disclosures
  • Contact us
  • About Us

© Copyright 2024 All Rights Reserved
See articles for original source and related links to external sites.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In
No Result
View All Result
  • Home
  • Financial Planning
    • Financial Planning
    • Personal Finance
  • Market Research
    • Business
    • Investing
    • Money
    • Economy
    • Markets
    • Stocks
    • Trading
  • 401k Plans
  • College
  • IRS & Taxes
  • Estate Plans
  • Social Security
  • Medicare
  • Legal

© Copyright 2024 All Rights Reserved
See articles for original source and related links to external sites.