As a divorcee and single mother, Sandy Andrews has been resourceful. When her only son was growing up, she bartered for piano lessons, took in foreign exchange students to help pay the mortgage and skimped on dining out.
But now Andrews, 55, has run out of money-saving ideas. To help pay for college for her son, Chris, she's stretched her finances too thin. Meanwhile, she's saved little for retirement.
"It doesn't look pretty," said Alfred McIntosh, a financial planner in Los Angeles who reviewed Andrews' finances. "If she continues at this rate she'll run out of money when she's 78 years old."
Andrews earns $88,000 a year as a registered dietitian at a hospital that's close enough to her Santa Monica home that she walks to work. She has $204,000 in retirement accounts and $2,500 in rainy-day savings.
Yet she struggles to pay about $2,300 a month on her debts. They total about $260,000 from a mortgage, a home equity line of credit, a car loan and a credit card balance. She is using the home equity line of credit to help fund Chris' college education in Maine. Largely because of that, she winds up $800 a month short, leaving her further in debt.
"I don't want to put my son in the position where he has to work so much to put himself through school," explained Andrews, adding that it took her seven years to pay her way through college. "He needs to have some fun."
But by paying for Chris' schooling, Andrews is sacrificing her own financial well-being, McIntosh said.
"My recommendation is to pay for absolutely none of it," he said. "I am recommending to her in the strongest terms possible not to do this."
McIntosh, like many planners, believes that middle-income parents short on savings can't afford -- and shouldn't try -- to pay for their children's college education. Those costs can be devastating at a time when parents need to convert more of what is usually their highest-earning years into retirement savings. Their children have years to pay off their loans, he reasons.
Chris also worries about how the costs of his schooling affect his mother's finances. The college sophomore works part time and scrimps, even borrowing textbooks from friends, which saves hundreds of dollars.
"I'm mostly concerned about what I can do to help her," he said.
Last semester, he made the dean's list at the University of New England in Portland, where his tuition, room, board and fees run about $39,000 a year.
