Solutions 4 Financial Independence: 10/05/17

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BRIDGEPORT, W.Va (WDTV)- Question: I have a child entering college and I did not save. I do have an IRA account, can I use that?

Answer (John Halterman, Beacon Wealth Management): "Typically an IRA account is meant for retirement. The government looks at it as retirement being over the age of 59 1/2. If you take money out before that, normally you're going to be subject to a penalty.

But the one thing the IRS does is that if you're using it for qualified expenses, such as college education, they will waive that 10% penalty as long as you meet the requirements.

Emotionally versus logically is two different things. Normally what I tell parents is that you can't take away from your retirement because unfortunately, when you take away from your retirement, you can't replenish that. And when you are in retirement you can't go out and get a loan. I would say to you, SmartMoney says to borrow money for college because your children have the ability to pay that back versus trying to borrow money for retirement. But that's from a logical standpoint.

Emotionally, I get it. This is your child, this is somebody you want to set up for a brighter future. And if you want to do it, you just have to understand the sacrifice because there is a trade-off. Basically you're giving to your child's future versus being able to take care of yourself in retirement.

So it's a decision that I try not to get involved in, I tell you what the facts are and let them make it, whether they want to be logical or emotional about it.