Overeducating your kids may be overkill

As parents, we want our kids to be well educated, and we want to lend a hand in helping them achieve their dreams.

But at a certain point, it takes too much of a toll on our own financial bottom lines. In fact, there’s an interesting trail-off in retirement happiness once the adult children begin to pile on multiple degrees. So where do we draw the line?

Education is a highlight of a young adult’s life. I loved my time at the University of North Carolina and can’t wait for my kids to have their own college experiences. I even love the graduation season. On a recent episode of my radio show “Money Matters,” I went so far as to take a graduation speech Hollywood star Matthew McConaughey gave at the University of Houston and analyze how his life advice could help make people better investors. In other words, I’m all in on the pomp and circumstance.

And, as a society, we value education so much that we even judge athletes for leaving school early to sign multimillion-dollar contracts. But let me go on record as saying that if you have an opportunity to immediately earn millions of dollars, it’s worth considering. My college degree helped open doors for my career, but it certainly didn’t drop millions into my bank account overnight. It took a long time to build the success I sought.

What I’m getting at is that even though education can be wonderful, overeducating your kids is overrated. That statement may shock you, and it even shocks me to say it. However, the data is clear for parents supporting adult children.

A Pew Research study found that the number of young adults (18 to 29) living with their parents grew to 26.6 million in July 2020. A staggering revelation. My own money and

happiness study of nearly 2,000 retirees nationally found that over 40% of parents were giving their adult children some level of financial support. This type of “help” walks that fine line between assistance and enabling dependence.

At first glance, retirement happiness and even longevity seem to rise with education levels. Essentially, more education is better for a variety of reasons. A 2020 article from Victoria Osorio at the Wharton School of the University of Pennsylvania showed that those with education levels beyond high school consistently had lower mortality rates than those who stopped after the 12th grade. Isn’t that a good thing? Of course. But it turns out that the old axiom about “too much of a good thing” also applies to education.

Now, if your kids didn’t graduate from high school or stopped directly after being handed that diploma, there’s a higher chance you’ll be an unhappy retiree. Families with children holding bachelor’s and master’s degrees saw the highest happiness levels. But the breaking news is that happiness levels began to decline in families in which the adult children receive doctorates, according to my research.

Why? Well, it’s hard to live your best life when the tuition bills keep landing in your mailbox while you’re on a fixed or reduced income. There are exceptions, such as when the advanced degree results in an appreciable skill set or professional qualifications like a law or medical degree. But when you’re taking money out of that nest egg because Junior wants to wax poetic about the Renaissance, it’s easy for resentment to pop up as you continue to write tuition checks. It’s admirable for your son or daughter to yearn for the lessons history provides, but they need to pay for it themselves.

I believe happiness levels typically rise with education because it often opens doors to independence for your kids. The more solid options they have, the easier it is for them to leave the nest. But if instead of leaving, they bring the book and bills back to the nest, the branch eventually will break. It’s not sustainable for you, and it’s not good for them.

The financial independence you gain by cutting off the tuition spigot ultimately may unburden your children as well. If you maintain better financial solvency, it keeps them from having to pay for your medical or retirement needs when the time comes.

Look, I get it. I want to protect my kids and give them every opportunity to succeed. But counting the cost isn’t just about dollars and cents. It’s also about the happiness of my wife and me in our relationship. When it comes to family, the key is finding the balance between familial connection and freedom.

If you’re still struggling with tough love, look no further than the aforementioned commencement address of Matthew McConaughey. One of his pearls of wisdom was to “give your obstacles credit.” In other words, sometimes the scary decisions you face mean you’re on the right track. If he had never been brave enough to audition for a part in the movie “Dazed and Confused,” the world would’ve been robbed of his glorious catchphrase: “All right, all right, all right.”

Be brave enough to trust that not only will your kids find their own path, but they also will thank you for it later. Build a beautiful nest, but know when it’s time to nudge them out of it.

Wes Moss is the host of the podcast “Retire Sooner with Wes Moss,” found in the podcast app right on your smartphone. He has been the host of “Money Matters”on News 95.5 and AM 750 WSB in Atlanta for more than 10 years now, and he does a live show from 9-11 a.m. Sundays. He is the chief investment strategist for Atlanta-based Capital Investment Advisors. For more information, go to wesmoss.com.