First place for your money: Retirement fund or child's tuition?
You're faced with a choice: put money in your retirement fund or pay for your child's college tuition. Which should come first?
Jean Chatzky, financial editor for the TODAY Show, says it's your retirement.
"Because there is still financial aid for college and there's not financial aid for retirement," Chatzky said.
Assuming your retirement is in fairly good shape, get going on saving for college. So where do you put the money?
"If you know this is definitely for college, then I would put the moeny in a 529 college savings plan. If you don't know that this money for college, but you want the option to use it for college or retirement, look to put it in a Roth IRA because you can save now, but make the decision later on about where you want to put that money," said Chatzky.
For students who need to borrow, Chatzky says don't take out loans for more than you need.
"You've got to look at college not just from the perspective of what's the best school but what's the best value. A guideline that was shared with me that I believe is a good one is: you don't want to borrow more than you believe that you'll earn in your first year out of school. If you can stick to that guideline then you'll be OK," Chatzky said.