Money Lessons You Don't Need To Follow
What used to be bedrock advice for your parents' generation might not be the best strategy in the 21st century. Here's how to keep pace with the brave new post–piggy bank world.
Old Lesson: Saving for Your Kids' College Should Be Priority Number 1
So if we don't want to send our children into student-loan debt land, we should be sure to save as much as we can in case they do want to go to college, right? The personal finance journalist and best-selling author of Get a Financial Life
, Beth Kobliner, says this is another big "nope." "It's definitely smarter for parents to max out their own retirement plan
," says Kobliner. "Particularly if their company will match their contribution—something they won't find in a college savings plan. And while kids can borrow for their college education, parents can't borrow for retirement, which means they may have to depend on their kids (who may already be struggling to make ends meet for their
kids) to support them down the road." And that's not all, Kobliner says. "A new study released earlier this month shows that the more money parents contribute to their kid's college education, the lower their child's GPA. The gist is that kids are just not as motivated to achieve, so they do well enough to graduate but don't push themselves to be their best." To which everyone who had a college roommate with a major in Modes of Recreational Drug Use in Party Settings says, "Yep."
Please note: This is general information and is not intended to be legal advice. You should consult with your own financial advisor before making any major financial decisions, including investments or changes to your portfolio, and a qualified legal professional before executing any legal documents or taking any legal action. Harpo Productions, Inc., OWN: Oprah Winfrey Network, Discovery Communications LLC and their affiliated companies and entities are not responsible for any losses, damages or claims that may result from your financial or legal decisions.