When you put a retirement plan together some of the things that you have to address are how to handle inflation, healthcare expenses, market volatility, and taxes. One derailer of a successful, happy retirement can actually happen many years earlier in your teens and early 20’s – Student Debt.
A study was recently published that compared households with an average student loan debt of $53,000 to those who carried no such debt. The average lifetime wealth loss was $208,000 with $134,000 coming out of retirement savings. Not having that $134,000 can mean the difference from a comfortable retirement to one that is a struggle.
Last month I published an article about the rules and options for college funding. Saving as early as possible and taking advantage of plans like 529’s are the best way to help pay for your child’s education and ensure that the impact to their retirement due to student debt is minimized.