Should You Save for Your Kid’s College or Retirement First?

This post was originally posted on Planner Bee.

If you’re a parent, you’ve probably stared at your bank account and wondered: should I save for my child’s university education, or focus on building up my retirement fund first?

It’s not an easy choice. University costs a lot. Retirement can cost even more. And unless you have plenty of spare income (if so, well done), you may not be able to fully fund both at the same time.

So, which should you prioritise: your child’s future or your own? Let’s take a closer look.

University vs retirement: Which costs more?

Let’s start with the numbers.

If your child is aiming for a local degree in Singapore, like one at the National University of Singapore (NUS), tuition fees will be around S$8,200 to S$9,600 per year for a standard undergraduate course. This assumes they are Singaporean and qualify for government subsidies. Over four years, the total tuition would be between S$33,000 and S$38,500.

On top of that, living expenses could cost about S$11,000 to S$12,000 a year. So in total, you might spend around S$80,000 to S$100,000 for the full course. Bear in mind that this estimate is for studying in Singapore. If your child studies overseas, the cost will likely be much higher.

Now, let’s consider retirement. This is harder to put a clear number on, but most financial planners recommend saving at least S$500,000 to S$1 million, or even more. The amount depends on the lifestyle you want and your expected living expenses. Remember, you may need to support yourself for 20 to 30 years without a regular paycheck.

So, if you compare the two:

• Local university: About S$100,000 (give or take)
• Retirement: S$500,000 to S$1 million or more

Retirement clearly costs much more.

The case for prioritising your child’s education

So why should you consider focusing on their university costs first?

1. Education is time-sensitive Your child cannot put off university forever. If they are only a few years away from starting, you’re on a deadline. Retirement, on the other hand, could still be 10 to 20 years away.
2. Student loans are a burden Beginning adulthood with a large loan hanging over their head is far from ideal. Helping them avoid debt could give them a massive financial head start in life.
3. A degree can pay off A good education can be a launching pad to better job opportunities, higher income, and long-term financial stability. In this sense, it can be a worthwhile investment that brings future returns.
4. It feels rewarding There’s a deep emotional satisfaction in helping your child succeed. Seeing them graduate without the weight of student debt is hard to put a price on.

The case for prioritising your own retirement

On the other hand, there’s a strong argument to put your own retirement first, and it’s not selfish.

1. There are no retirement loans Your child can take a loan for university. You can’t borrow for retirement. If your savings fall short, your choices in later life will be limited.
2. Time is your greatest asset The sooner you start saving for retirement, the more your money can grow through compound interest. Delay for a few years, and you might have to save twice as much just to catch up.
3. You don’t want to be a burden If you prioritise their education first and neglect your retirement, you may end up relying on them financially in the future. This could undo all the help you gave them in the first place.
4. Retirement can last decades With life expectancy rising, you could spend 25 to 30 years in retirement. That’s a long time to stretch limited savings.

How to decide what’s right for you

Still unsure? These questions might help you decide:

• How close is your child to university? If they are starting in two years, time is short. If they are only eight years old, you have more time to plan and balance both goals.
• How much have you already saved for retirement? If your CPF, SRS, or personal savings are on track, you might be able to set aside some funds for your child’s university costs.
• How flexible is your lifestyle? Could you retire later, reduce expenses, or work part-time in your golden years? If so, you may have more room to focus on education savings for now.
• Does your child have scholarship potential? If they are likely to qualify for government or merit-based scholarships, you may not need to fund the full amount of their studies.
• What’s your fallback plan? If something unexpected happens, such as job loss or illness, which pool of savings do you absolutely need to protect?

Your answers to these questions can help you set your priorities more clearly.

Read more: How Does the CPF Retirement Account Work?

Or… what if you didn’t have to choose?

Here’s a thought: what if you could manage both? A balanced approach is what many families choose, and it can work well.

1. Split your savings

Allocate a percentage of your monthly savings for each goal. For example:

• 60% to retirement
• 40% to education

Or vice versa, depending on your situation and timeline.

2. Plan the timing

If your child is still five to 10 years away from university, you can save more for their education now and shift focus to retirement once their tuition is sorted.

3. Use the right tools for each goal

For retirement, make use of CPF, SRS, or investment accounts with potential for higher returns. For education, consider a dedicated savings plan or a low-risk investment portfolio.

It is not about getting it perfect. It is about finding balance and staying flexible.

Read more: Why You Should Set Up a Supplementary Retirement Scheme (SRS) Account

Let’s do some quick maths

Here’s a simple example to give you a clearer picture:

• University costs

Your child is 8 years old, and you want to save $95,000 for their local university education (covering tuition and living expenses, adjusted for 2% inflation).

If you save in cash with no investment returns, you would need to save about $790 / month for 10 years to reach that goal.

• Retirement costs

You’re 45 and want to retire at 65 with $600,000. You already have $100,000 in your investment portfolio and expect a 5% annual return on your investments.

To close the gap, you would need to save around $1,400 / month.

In total, saving for both would mean setting aside roughly $2,190 / month. This may not be realistic for everyone, but at least now you have a clearer target to work towards. These figures assume your savings are not earning any returns. In reality, investing your monthly savings in a stable fund can reduce the amount you need to set aside.

With just 2% p.a annual return on your savings:

• The monthly amount for university costs drops to about $720
• Retirement savings reduce to around $1,150 / month
• That brings your total to roughly $1,870 / month, instead of $2,190

Even a small return on your savings can ease the monthly load. With a structured plan and consistent contributions, it is possible to make steady progress towards both your child’s education and your own retirement.

Pro tip: You can use tools like Planner Bee’s Retirement Calculator for more accurate, personalised numbers.

Read more: Are You Risk-Averse? Here Are 5 Safer Investment Options

The bottom line

Here’s the simple truth: you come first.

Not because your child isn’t important (they certainly are), but because your own retirement security must come first. You can’t pour from an empty cup.

That said, it does not have to be all or nothing. With some careful planning, a few spreadsheets, and a bit of discipline, you can often support both goals. Maybe not perfectly, but well enough.

So take a deep breath, work out the numbers, and build a plan that works for your family. The real goal is not just financial success. It’s peace of mind.

Read more: CPF Hacks To Become a Millennial Half-Millionaire