TYLER, TX (KLTV) - During tough economic times, many families say they struggle with ways to save money. But, when it comes to your children's college funds and your retirement fund, financial advisors say it is very important to put your money in the right place .
Leslie Strader says with three young children, the family budget is tight. It's easy for other expenses to get in the way of saving for college and retirement.
"There are always trees to trim, or a weird noise in your car, or braces," said Strader.
So, Leslie and her husband came up with a plan. A little for their own retirement, a little for their kids' college funds.
"We are going to save this much for you, and if you decide to go somewhere that is more than this much, then you are going to participate and be responsible," said Strader. "There are no free rides at our house."
While there are no free rides at the Strader household, investment consultant Steve Mills says many families are torn between retirement and college. When in doubt, he says the best plan is save for both.
"Fortunately, these days, you have vehicles you can use to solve both of those problems," said Mills.
And, these vehicles are a 401-K plan or a ROTH IRA where money grows tax deferred. When it's time for college, there are ways to take money out or leave it in.
"It is a constant battle, I think, for people, especially when their kids are young," said Mills.
Strader says it's hard to focus on retirement when it's so far away.
"It is not like, 'Oh my gosh, we have to have a million dollars in 10 years!'"
But, Mills says be careful. If you must choose, pick retirement.
"There are scholarships available, there are loans [and] there are grants," said Mills. "If you want to have any kind of a lifestyle at all when you retire, you are going to need to save for it because Uncle Sam is probably not going to take care of you in the manner of which you currently do."
So, be wise now, and your kids will thank you later. Financial advisors we spoke to recommend saving at least 10 percent of your salary. And, as your income grows, increase the amount you save.