Madison, Wis. — Are you going to outlive your money?
That is the single-biggest fear facing would-be retirees as the giant Baby Boom Generation heads toward retirement, according to John Vardallas, CEO/founder of TheAmericanBoomeR Group, here.
Many need cash now, and are taking it where they can get it, especially to pay for children's college educations. "People are tapping into their retirement," he said. "That's a huge mistake. They shouldn't risk their retirement, risk their welfare."
Jeopardizing one's retirement account to pay for mortgage or school is a huge mistake right now, Vardallas said. "That's dangerous," he said. "We gotta take everything one day at a time here. It's hard-there's no crystal ball out there. The key is to protect what you have. Do not lose anymore."
Instead, parents should consider student loans, he advised. "Or instead of a four-year college, consider community college first," he said. "A lot of that is going on right now. Or you may have to tell your child they may have to work."
It's a reality 80 million boomers are facing right now, many having to help their children, be caregivers to their parents and in-laws, while still caring for themselves, Vardallas said.
"A lot of children are moving back in with their parents. Students are graduating law school, and can't find jobs, and have 10 years of student loans," he said.
As far as people cashing in their 401k accounts for basic living expenses, or for funding their children's college expenses, Alec Berkman, chairman of Executive Compensation Solutions, said there may be some of that going on, "but folks across the board have lost major portions of their assets and may not have any salary to replace them."
"There are also a lot of people who don't have college funds, retirement funds or savings," he said. "It seems that if people do have these kinds of assets, they should carefully decide what adjustments in their planning need to be made to weather this crisis."
