Meredith Moore is the Founder & CEO of Artisan Financial Strategies LLC. She is fascinated by the interplay between gender, money and power.
You can get a loan for law school. You can’t get one to walk away from your business at 55. That’s why college planning has to serve your future—not just your child’s.
While everyone from families to the Fed is concerned about inflation, college costs in America are rising much faster than most other elements in the economy. For high-income families who may appear well-positioned to cover tuition, the choice between funding children’s education and maintaining retirement security is more complex than ever.
Parents with strong incomes often carry significant other financial priorities: retirement, supporting aging parents, maintaining a second home and managing restricted stock portfolios are just a few of the common considerations for these families. When college expenses enter the conversation, the question becomes how to balance everything without jeopardizing long-term financial independence.
The State Of College Costs Today
According to the College Board’s Trends in College Pricing 2024, the average annual published amounts for tuition, fees, room and board stand at:
• In-state public: around $28,000
• Out-of-state public: around $46,000
• Private: about $60,000
Those figures are almost certainly higher in 2025 and will no doubt rise again in 2026. In fact, over the last 20 years college prices have grown at roughly twice the rate of overall inflation, according to the College Board.
The Student Debt Landscape
As a result, student loan balances continue to rise. The average federal student loan balance is now about $37,700 per borrower. Cumulative student debt nationwide exceeds $1.57 trillion, according to the Federal Reserve Bank of New York.
Numerous studies have found that student debt delays wealth-building milestones, including homeownership, for years. Most high-income parents want to protect their children from this burden, but at what cost to their own future?
The Retirement Savings Shortfall
While your retirement accounts may appear healthy, data from the Federal Reserve’s Survey of Consumer Finances show that even higher-income households often fall short of retirement savings benchmarks. Lifestyle creep, rising healthcare costs and longer life expectancies have left many Americans behind target.
For parents in their 40s and 50s, the temptation to fund college first can derail decades of carefully built retirement plans. And while there are loans for education, there are no loans for retirement.
The Parental Contribution Dilemma
According to Sallie Mae’s How America Pays for College 2025 fact sheet, families cover college costs with 48% from family income and savings, 27% from scholarships and grants, 23% from loans and 2% from relatives or friends.
Family culture, financial security and personal beliefs all factor into this decision. In high-income families, there can be an unspoken expectation of “of course we will pay,” but that assumption rarely accounts for graduate school, living expenses or unexpected changes to household income.
Funding Strategies
There is no one-size-fits-all answer to this complex problem. Instead, families should build a deliberate, tax-aware strategy:
• Use your state’s 529 plan to benefit from tax deductions or credits.
• Coordinate 529 withdrawals with cash flow and other taxable accounts.
• Integrate college funding into your overall retirement plan, not separate from it.
• Consider the opportunity cost of using restricted stock or equity compensation to cover tuition.
• Have honest conversations with your kids about reasonable graduate school expectations.
Graduate programs like law school, medical school or an MBA can easily add six figures of additional debt if not planned for early. While you may be thrilled that your child wants to pursue graduate or professional education, it’s important to address the financial aspect of these plans well before it’s time to pay for the schooling.
A Personal Perspective
My parents made their expectations clear: no B’s, and no help with college funding. I found my path through a swimming scholarship at Rice, then transferred to Georgia Tech. It was tough, but it taught me resilience and independence.
Today, I see clients in their late 40s with robust retirement accounts, valuable homes and healthy investment portfolios. Often, they have contributed to 529 plans but realize too late that those funds won’t cover the whole picture. They want to help with graduate degrees, living expenses or future internships, but they don’t know the smartest way to tap other assets without derailing their own retirement.
The problem isn’t that they cannot pay; it’s that their strategy is not optimized.
If you don’t have a strategically optimized plan for these costs, paying for an education can cause way more financial disruption than it has to and be unnecessarily detrimental to your overall financial position.
Get Help Finding The Right Balance For Your Family
There are no perfect solutions when balancing college and retirement. The best plan for each family will be different. But there is a universal truth: Protecting your retirement must come first. Again, there are resources that let anyone borrow for education at any stage of life, but there are no resources to borrow for retirement.
With a coordinated plan, open family discussions and the help of tax- and investment-savvy advisors, high-income parents can give their kids a strong start in life without sacrificing their own financial independence.
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