'The balance feels off': A Midwest couple is prioritizing their kids' 'sacred' college fund over retirement — Ramit Sethi says it's keeping them stuck

Mia recently wrote to personal finance expert Ramit Sethi and appeared with Jake on his podcast, I Will Teach You to Be Rich. She explained that she sometimes feels her husband is frustrated by how much of their household income goes toward the children, particularly their education. Jake admitted he has questioned whether they are putting too much money toward school.

“I know what’s best for the kids and our family and investing in their school and I think it’s the right thing to do,” he said. “But I’m not sure.”

Sethi pointed out that the pair is treating their kids’ college education fund as a “sacred” mission, with no real end in sight. If they put a fixed limit on their 529 saving instead, they could shift more money toward their nest egg to supplement their pensions.

“The balance feels a little off,” Mia admitted.

Investing in the future

Sethi pressed the couple on how they decide what comes first: saving for college and paying for preschool, or leaving more room in their budget for guilt-free spending.

For Mia, putting less toward the children’s future feels selfish. Jake largely agrees, even if he sometimes wonders what that money could do for their lives right now.

“Man, if we just took the money we’re spending on college in 8 months we could do a hot tub and probably start on the landscaping,” Mia recalled Jake saying during a walk.

The comment captured the trade-off at the center of their financial tension. Every dollar they put toward the children’s education is money they can’t use to improve their home, enjoy themselves or invest in their retirement.

They are hardly the only parents feeling pressure to prioritize college savings. Half of parents say they have no idea how they will afford their children’s education, according to a Talker Research survey conducted on behalf of College Ave. Although the average parent surveyed had saved nearly $37,000, only 32% believed they had enough to cover the full cost.

College is also only one part of the financial burden. According to a LendingTree study, raising a child in the U.S. now costs an average of more than $303,000 from birth through age 18.

Knowing the numbers

For Mia and Jake, those costs are competing with the life they want to enjoy today — even though, on paper, they appear to be doing well. Their combined gross income is $226,348 a year — more than 2.5 times the median U.S. household income of roughly $83,730, according to data tracked by the Federal Reserve Bank of St. Louis.

Both recognize how fortunate they are to earn that much. What they cannot understand is why they still feel so stretched. Despite bringing in more than $200,000 a year, they have enough savings to cover only about two months of expenses.

Sethi suggested guilt may be clouding the way they make financial decisions.

“Just because you feel guilt doesn’t mean you have to follow the feeling,” he said.

Instead of allowing guilt to decide where their money goes, Sethi encouraged the couple to look closely at the numbers, have more honest conversations and create a shared vision for their “rich life.”