January 18, 2016

Once the kids move out the parents need to buckle down and save the money they would have spent on their kids

A study by the Center for rRtirement Research at Boston College revealed that when adult children leave home parents are failing to take the opportunity to boost their retirement savings. "The CRR researchers found that on average households increased contributions to 401(k) plans by just 0.3 percent to 1 percent of their earnings when their kids leave home" as reported by Steve Vernon. He explains: "Once you're no longer supporting your kids financially, you have a golden opportunity to improve your retirement security, either by significantly boosting your 401(k) contributions or paying down your mortgage faster. It's understandable to celebrate the departure of child-related spending by going on a spending or travel spree -- just realize that such spending comes at the expense of your financial freedom in your retirement years." So get gear buckle down and start boosting retirement contributions when the kids leave home. While many parents continue to help support their adult children after they leave home, both parents and children need to consider the long-term impact of the failure to adequately prepare financially for a potentially long retirement. The kids will definitely appreciate financially secure parents who are not dependent on their children in retirement. Read Vernon's article at: http://www.cbsnews.com/news/parents-are-missing-a-golden-opportunity-to-save/?utm_source=newsletter&utm_medium=email&utm_content=Parents%20Miss%20Chance%20to%20Save%20More&utm_campaign=Winter%202016%20Newsletter

No comments:

Post a Comment

Financial Planning for Women does not sell, rent, loan, lease or otherwise provide any personal information collected at our site to any third parties.