As I was growing up, my parents asked what I consider a right question. For them, it was: Should they take a vacation or save for college and retirement? "Take a vacation" could be replaced by "buy a new car," buy a bigger house, " or any number of discretionary purchases. More often, than not, the answer was save for college and retirement. As a result, my parents had enough funds saved for both our college and their retirement.
Should You Save for College or Retirement? is a great example of what I consider asking a poor question. In the article, a financial advisor advocates that retirement savings should be first priority and college savings should be second. While her logic makes sense, I think the opportunity for a good lesson in personal finance was missed.
To me, a good question chooses between spending or saving for retirement and college. Food or save? Food. Replace five year old car or save? Save. Wide screen TV or save? Save.
For me, the answers are much easier when the right question is asked.
For more on Reaping the Rewards, check back every Friday for a new segment.
This is not financial, saving or retirement advice. Please consult a professional advisor.
Copyright © 2009 Achievement Catalyst, LLC
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