Saving Money For College Education - 1001 Words

saving money for college education as opposed to retirement, there are several other factors that contribute to Gen X’s lack of funds for retirement (Powell, 2015). Gen X carries the most debt in comparison to Baby Boomers and Millennials. According to a study by the Federal Reserve Bank of St. Louis, Gen X owes an average of $142,007, mostly comprised of mortgage debt. In comparison to Baby Boomers, Gen X held about 60% more debt at age 44 than the earlier cohort. In addition, the household income at the same age was only about 5% higher than Baby Boomers. Therefore, while Gen X is not making much more money than Baby Boomers, they have accumulated more debt, and are reducing debt at a slower pace than any other generation (Matthews,†¦show more content†¦The first step in creating a retirement plan to last at least 25 years is to set short term goals, understand good debt versus bad debt, and how to prioritize paying off debt to allow the additional income to be saved for retirement. Bad debt, such as personal loans, car loans, and credit card debt carry high interest rates, and do not represent a future investment; bad debt loses value over time. Good debt, or debt with a low interest rate, can be viewed as a future investment. This type of debt includes mortgages, business loans, and student loans (Von Tobel, 2014). Paying off bad debt first reduces high interest payments, which then can be applied to an overall retirement savings plan. Approximately 50% of credit card users carry a month-to-month balance, and are required to pay accrued interest charges. According to Ghilarducci, actual credit cards should stay home, in a hard to reach place to be used only in the case of an emergency. While it is critical to pay down credit cards, high interest loans, and avoid carrying a balance, it is also important to make solid financial decisions pertaining to good debt. Paying off a mortgage in 7 or 15 years will raise the current monthly payment, but will save money overall by qualifying for lower interest rates, andShow MoreRelatedStudents Should Start Planning For College At The Beginning Of High School14 43 Words   |  6 PagesBill Bennett stated of higher education, â€Å" The higher amount you put into higher education, at the federal level particularly, the more the price of high education will rise. It’s the dog that never catches its tail.† Bennett asserts that while the prices of education are rising, they are not going to start falling as a result of, the amount the government puts in (Student Loan Quotes, 2015). The average student leaves college with an average of $35,000 of debt. With this debt, students have toRead MoreAdvantages Of College Tuition1693 Words   |  7 Pagesattending college. The main argument that we have is whether college tuition is too expensive or not. Over the last few decades the college tuition rates have increased drastically, but is a rate increase necessarily a good or bad thing. I personally believe that the cost to attend college is too expensive especially for low and middle-income families. There are many reasons why tuitio n could be considered too expensive they include, rise of tuition, little financial aid, and lack of college savings toRead MorePaying For A Higher Education871 Words   |  4 PagesPaying For a Higher Education There are over two hundred and fifty five worldwide childbirths per minute, and almost fifty seven percent of those who are born will not be able to use their own money to pay for college (Central Intelligence Agency 2). College is a very important aspect of life today. Each year things change in this world. Post-Secondary education is becoming a major requirement with most jobs today. Whereas in the past, post-secondary education was not as prevalent. Many studentsRead MoreHigh Education Vs. Out Of State Tuition1564 Words   |  7 PagesBill Bennett said of higher education, â€Å" The higher amount you put into high education, at the federal level particularly, the more the price of high education rises. It’s the dog that never catches its tail.† Bennett asserts that while the prices of education are rising, yet they are not going to start coming down because of the amount the government is putting in. The average student leaves college with an average of $35,000 of debt. Because of this debt, students have to put off majorRead MoreGraduation Speech : Avoiding College Debt895 Words   |  4 PagesAvoiding College Debt From elementary school career days to college visits in high school, the importance of continuing our education is drilled into our heads from day one. What the adults who so graciously give up their time to speak at career day fail to mention is enormous cost of college. So, what is a parent to do, dash their child’s dream of becoming a doctor, or find a way to make it happen? We all know a college education comes with a high price tag, but with all the advantages like highRead MoreBenefits Of The Prepaid Plan1038 Words   |  5 Pages We know college can be very expensive. There are many expenses for higher education including; tuition, room and board, books, and extra cost. That being said, there are many programs and plans that can assist with the cost. I will discuss 529 plans, Coverdell education savings account, American Opportunity Tax Credit, Lifetime Learning Credits, and tuition fees. There is a 529 Plan that can help the parent start preparing for their child’s college. The plan will help families save many for futureRead MoreSample Financial Plan Description1594 Words   |  7 Pagesplan to help you retire at the age of 62 and afford to send your son, Sam, to college. 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While parents of college-age students can provide guidance and direction on the perceived correct path, the commitment and determination falls on the shoulders of the student—requiring much contemplation in makingRead More math lesson Essay1734 Words   |  7 Pagesresult of limited resources. Student Objectives Students will: †¢ Identify quot;opportunity costsquot; in the story and in their own lives. †¢ Create an opportunity costs bar graph as a whole class. †¢ Complete a table of personal spending and savings information. †¢ Write an original story about how they spent and saved their allowance and what they gave up or their quot;opportunity costsquot; in order to reach their goals. Materials: †¢ a copy of Alexander, Who Used to Be Rich Last SundayRead MorePersuasive Speech : Greedy Money Hoarders1484 Words   |  6 PagesGreedy Money Hoarders   Ã‚  Ã‚   Imagine being a student in college, when you receive a letter telling you how much you owe in tuition fees. You already have a full time job, and still manage to get to your daily classes, but with the minimum wage pay you receive you can’t afford the basic necessities and the tuition prices that seem to increase every year. Your parents refuse to help you, so you’re on your own. Parents have decided it’s a cultural norm to have their children leave the house and become