Journey/Family Builder/College Planning Without Derailing Retirement
Family Builder · Ages 30–39 · 5 min

College Planning Without Derailing Retirement

You can borrow for college. You cannot borrow for retirement. Both matter — but the order matters more.

Key Decisions at This Stage
Decide how much of college costs you'll cover vs expect your child to fund.
Choose a vehicle: 529, Roth IRA, or IUL cash value for education funding.
Set a contribution rule you can sustain regardless of market conditions.
529 Plan
A state-sponsored savings account for education with tax-free growth and withdrawals for qualified education expenses. Contributions are not federally deductible but some states offer deductions.
IUL for education
Using the cash value of a permanent life policy to fund college. Advantages: no contribution limits, doesn't count against FAFSA, and policy remains useful after college.
Coverdell ESA
An education savings account with $2,000/year limit but more flexibility on qualified expenses (including K–12). Less common but useful for private school families.
1
Open a 529 with even $50/month — time matters more than amount.
2
Run a side-by-side comparison: 529 vs IUL funding with your agent.
3
Don't stop retirement contributions to fund college — sequence matters.

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