Cash Crunch in Your Forties: Your Children’s Future or Your Own?

by Stacy Francis, CFP®, CDFA

This dreadful dilemma was the main topic of discussion at a recent Savvy Ladies event. And the economy being what it is, alas, it is one to which far too many of us can relate. We all want what’s best for our children, so what could possibly be more important than securing them a top-notch education? On the other hand, past big 4-0, retirement is no longer a hazy, distant concept but something very real, approaching at rocket speed. So when faced with job loss and financial hardship, how do we prioritize?

The answer is quite simple: stick to your retirement savings plan, and direct whatever’s left toward the college savings account. It may sound selfish, but the truth is, no one’s going to give you a scholarship or a favorable retirement loan. And not only do your children have time on their side, greatly enhancing their chances to pay back whatever balances they may accrue, but the less savings you have set aside for them, the more financial aid becomes available to them. Once your financial situation starts to improve, you can certainly lend them a hand.

Ask any child what he or she would prefer – a bit of student loans or an aging parent crashing on the couch for, say, fifteen years. I’d say chances are high he or she will opt for the student debt.

So stick to your retirement savings plan. Then help your children.


Stacy Francis, CFP®, CDFA

Stacy Francis is the Founder, CEO and President of Francis Financial, Inc., a Wealth Management and Financial Planning firm. With over 18 years of experience in the financial industry, she is a CERTIFIED FINANCIAL PLANNER™ (CFP®), a Certified Divorce Financial Analyst™ (CDFA™), and a Certified Estate Planning Specialist (CES™). She is the Co-Director of the Association of Divorce Financial Planners’ (ADFP) Greater New York Metro Chapter and a member of the Women Presidents’ Organization (WPO) and an honoree member of the Private Risk Management Association (PRMA). A nationally recognized financial expert, Stacy has appeared on ABC News, CNBC, CNN, PBS Nightly Business Report, The Today Show, Good Morning America, Fine Living Network, and The O’Reilly Factor. Stacy attended the New York University Center for Finance, Law and Taxation.