Pay for college or save for retirement?

It doesn't have to be an either-or, but there are important considerations to review.

Parents with their young daughter sitting at a restaurant table with their financial professional looking at charts and graphs to help decide how to pay for college or save for retirement.

Many people assume when it comes to building retirement savings or stashing money for college, it's too hard to do both. We put the question to Arielle O'Shea, an investing and retirement specialist with NerdWallet, to see what an expert says.

Q: If I love my kids, I'll put their college first, right?
AO: I'm a parent, and I understand that instinct. But think of it from a different angle: Do you want your kids to be supporting you when you're in your retirement? Probably not. The best way to avoid that is to make sure you're meeting your retirement goal first and then decide whether — and how much — you can afford to start saving for college.

Q: What's your advice for people who delayed having kids?
AO: The less that time is on your side, the more you need to prioritize retirement. It's becoming cliché, but there's no financial aid for retirement. No one is going to give you a scholarship and no one is going to give you a loan for retirement. And you might find yourself in a situation where you want to continue to work but can't or can't find the work. It's not always completely in your control when you retire.

Q: If I can manage both college and retirement savings, what's a good way to juggle them?
AO: First, contribute to your retirement plan through your employer, if you have one. Make sure you are contributing enough to your retirement plan to receive the full employer match. There's no gray area there.

Once you've done that, some of the accounts that do double duty are a good choice. With a Roth IRA, you can pull out your contributions at any time, and qualified distributions from a Roth IRA in retirement may be tax-free. When the kids get closer to college and you're closer to retirement age, you'll have a much clearer picture of how you can use the money to reach either goal.

Q: Any retirement or college saving tricks you like?
AO: "Found" money can be a good way to save for college without sabotaging your retirement. Get a credit card that deposits rewards directly into a college savings account or get a card that has a good rewards program and just deposit it back into a 529 plan.

I have three young kids, so my big plan is that when they go to public school, I'm going to use all the "found" money I've been using on daycare to fund their college and my retirement more. You can do that with a car loan or any other big expense that is going to go away.

Neither State Farm nor its agents provide tax or legal advice.

The information in this article was obtained from various sources not associated with State Farm® (including State Farm Mutual Automobile Insurance Company and its subsidiaries and affiliates). While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. State Farm is not responsible for, and does not endorse or approve, either implicitly or explicitly, the content of any third party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. State Farm makes no guarantees of results from use of this information.

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