BOSTON (CBS) – You wake up one morning and you realize the baby is having a birthday and she’s 13 today. Oops, what happened to all of the planning you were going to do? Your little girl has grown so quickly and her brothers are now 15 and 17 and come this fall they will all be in high school.

You and your spouse are both working and try to be around for the kids as much as possible. The kids keep you busy every waking minute so you’ve had no time to think about the lofty goals you made 17 years ago when your first child was born. You have been keeping your head above water and are paddling as fast as you can.

Most common goals:

  • Send the kids to college
  • A comfortable retirement

Send The Kids To College:  College planning should not come as a surprise for the parents of teenagers but it often does. They have been so busy raising the kids and getting through the day-to-day stuff that the future seemed so far away. But it is fast approaching. With the oldest only months away from college applications it is time to have a college chat with all of the kids.

But before you have that chat figure out what you can afford to pay for their college education. How much can you borrow over the next 10 years? With nothing saved, college will be paid for with loans and current income. And you want to treat all of the kids equally so be sure you don’t shoot the wad on the older kids and have nothing left for the last child.

It’s not too late to start saving for the last child. Consider using the Massachusetts’ 529 college saving plan managed by Fidelity.

A Comfortable Retirement:  It’s never too late. Your retirement savings does not become an asset that colleges expect you to tap into to help pay for college. Although many retirement plans do allow you to borrow for college and if you have IRAs you can actually use them to help pay for college.

I would not recommend using the IRAs because unlike borrowing from the 401(k) you can never repay the money to the IRA. You will owe taxes on the IRA withdrawals but no penalty if used for college.

Keep contributing to the retirement plans if you can. Hard as it may be you will thank me in 20 years once you reach age 67 and want to retire.


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