SOURCE: Certified Financial Planner Board of Standards

Certified Financial Planner Board of Standards

December 09, 2009 15:57 ET

Do Not Sacrifice Your Financial Wellbeing for Your Children

The New Financial Realities: Personal Statement by Eleanor Blayney, CFP® Consumer Advocate for the Certified Financial Planner Board of Standards (CFP Board):

WASHINGTON, DC--(Marketwire - December 9, 2009) - The financial events of the past year have taught us that we can no longer afford to think about our personal finances as we did in the bubbly pre-recession days. Today, there are new financial realities; we must re-examine some basic assumptions and consider some new approaches. Over the course of this series, we are looking at nine important financial strategies. This week: It's Okay to Be Selfish; Your Financial Wellbeing Comes Before your Children's.

The average cost of raising a child through the age of 17 in the U.S. has been estimated at well over $200,000. This estimate does not include the cost of a college education which can range from $20,000 to $60,000 a year, depending on whether the child attends a public university or a private college. In today's financial environment money has become a scarce resource, forcing Americans to make hard budgeting decisions. The dilemma is particularly acute for parents, whose first priority is often their children. When it comes to a choice of funding education or funding their own retirements, many parents put their children's needs first.

Parents need to rethink this choice. The reality is that there are multiple options for financing a child's education, such as loans, grants, scholarships, and work-study programs. These options simply do not exist for retirement. Pension plans are becoming a thing of the past, and Social Security is designed to cover only your most basic requirements.

It's time to get serious and selfish about saving for retirement, putting it ahead of education savings or other privileges we want for our children. If this goes against your parental instinct, consider this: if you do not take care of yourself, it may well fall to your children to do so. Being selfish is in fact one of the best ways to take care of your kids.

Be straightforward with your children about how much you can afford for tuition. Get them involved in evaluating some cost-savings options, such as attending college closer to home or working while studying. Teach your children the importance of fiscal responsibility by showing them how to save, invest, and prioritize their expenditures. This will help them in the future when they have to start planning their own retirements.

As the Consumer Advocate for CFP Board, I offer you the same advice given during every preflight safety speech: if you are traveling with a child, put your oxygen mask on before assisting others. Your financial security comes first. It is never too early, or too late, to plan for the last, important decades of our lives. There are more than 60,000 CFP® professionals who can help you build new income, investing, and spending strategies for surviving and thriving in your retirement. Go to www.CFP.net and learn how a CFP® professional can help you.

To view the new financial realities series, please visit http://www.cfp.net/learn/advocate.asp

Eleanor on Twitter: http://twitter.com/EleanorBlayney

Eleanor on FiLife: http://www.filife.com/user/eleanorblayney

Eleanor on LifeTuner: http://www.lifetuner.org/users/eleanorblayney

About CFP Board:

The mission of Certified Financial Planner Board of Standards, Inc. is to benefit the public by granting the CFP® certification and upholding it as the recognized standard of excellence for personal financial planning. The Board of Directors, in furthering CFP Board's mission, acts on behalf of the public, CFP® certificants and other stakeholders. CFP Board owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and federally registered CFP (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements. CFP Board currently authorizes more than 60,000 individuals to use these marks in the United States. For more about CFP Board, visit www.CFP.net.

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