By George Erb
The Seattle Times.
Joel and Lisa Hamilton have steady jobs, a suburban home and three lively daughters that they worked very hard to bring into the world.
But their desire to pay for their children’s college educations, save for retirement and maybe fix up the house collided with financial realities.
With the help of a volunteer financial planner, the Hamiltons made some hard choices that reduce the odds of them running out of money in their old age. To do so, however, they had to give up something dear for the time being, paying for their daughters’ college degrees.
“We would like to put money away for our kids’ college, but it’s just not possible,” Lisa Hamilton said.
The couple’s story underscores the challenges that face many middle-class families. Parents must manage the expenses of raising children, saving for college and paying off mortgages while still socking away money for retirement. It doesn’t always pencil out, no matter how hard they try.
Joel Hamilton, 42, earns $60,000 a year before taxes as customer-service manager at Full Circle Farm, a Seattle company that provides local, organic produce to customers in five western states.
Lisa Hamilton, 39, is a part-time, third-grade teacher. Last year she earned about $37,000 before taxes, although she expects to earn about $50,000 in the current school year by working more hours.
They both have retirement accounts. Lisa Hamilton has about $72,000 in her teachers pension and a 403(b) retirement savings plan. Joel Hamilton has about $86,000 in a 401(k) account. The Hamiltons also have about $7,000 in savings and no credit-card debt.
Debt is a larger issue. Like many others, the Hamiltons were swept up in the housing bubble and the problematic lending of the previous decade.
In 2006, near the peak of the housing bubble in the Seattle area, the Hamiltons sold their house and bought a home for $361,000, property records show. The couple were ready to start a family, and they wanted a larger home in a community with good schools.