Re: college vs retirement

In article <[EMAIL PROTECTED]>,
 Banty <[EMAIL PROTECTED]> wrote:

> In article <[EMAIL PROTECTED]>, Elizabeth Gardner
> says...
> >
> >In article <[EMAIL PROTECTED]>,
> > [EMAIL PROTECTED] (Robyn Kozierok) wrote:
> >
> >> In article <[EMAIL PROTECTED]>, Richard  <[EMAIL PROTECTED]> wrote:
> >> >Robyn Kozierok <[EMAIL PROTECTED]> wrote:
> >> >: I believe it's usually possible to borrow from your retirement funds
> >> >: for education expenses, if necessary.
> >> >
> >> >Yes, it is, though I would consider that close to a last resort.  
> >> 
> >> I'm curious as to why you would consider it a last resort?
> >> 
> >
> >Can't speak for Richard, but I'd consider it a last resort for the 
> >reasons previously mentioned--that you can always borrow for education, 
> >but you can't borrow for your living expenses in retirement.  
> >
> >That said, if you put all your resources into retirement savings (up to 
> >whatever your contribution limits are, of course) with the express 
> >intention of taking them back out again for education if necessary, I 
> >don't see why that wouldn't work on some level.  That way, you've got 
> >the tax-free compounding and if another source of money crops up (say 
> >today's active toddler turns into an athletically inclined 18-year-old 
> >who gets a four-year free ride on the football team), you aren't stuck 
> >with a large amount of savings earmarked for education and nothing else.
> 
> That may be true with good planning.
> 
> What needs to be accounted for, though (and one that many frankly wouldn't 
> well
> account for) is that one subsequently needs to maintain enough income to pay
> this loan back.  And one's plans concerning maintaining this income won't
> necessarily come to pass.  For employment reasons, for health reasons.  So
> there's a significant risk against what is one's own sustenance the remainder 
> of
> one's years on this planet.  I'm not saying therefore it's wrong, but one
> *really * has to have eyes open.
> 
> The thing is - education is an investment in the future of the grown child. 
> Which may for that reason be best financed from the income which comes from 
> that
> investment - future income of said grown child.  Continuing income and health 
> is
> a much much surer bet for a 22 year old than it is for a 52 year old.
> 


All very true.  If you have to choose between the two, then obviously 
the retirement money comes before the education fund.  But if you were 
going to stash money away for college anyway, it might be better off in 
your IRA than in a savings plan earmarked for college.   The only 
advantage I can see to the latter is that people other than yourself 
(like grandpa) can contribute to it also.   We have a 529 plan, but it's 
mostly so that we can collect bits of change here and there from our 
uPromise activity.