This was the problem facing Ken and Sarah. They had crunched the numbers on how much money college for their children -- Emily, five, and John, three -- will cost. The results were scary: They'll need more than $100,000 per child to pay for four years at a public university, and double that amount for a private school.
Their first instinct was to slash contributions to their retirement plans and funnel the money into accounts set up in the children's names and earmarked for college. After all, college bills will start arriving in 13 years, and Ken and Sarah could concentrate on their retirement planning once the children were out of school.
Why It's Better to Save for Retirement
Ken and Sarah spent several evenings at the kitchen table developing a plan. To their surprise, they concluded that they should make retirement saving their priority. Here's why:
- Money saved in their 401(k) retirement plans goes further because the contributions aren't taxed and both of their employers match 25 cents
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