Should You Upsize When College Tuition and Retirement Collide?

With $4 million saved, a couple wants a bigger home for their teens before retiring in eight years. In this week's Wealth Wise advice column, advisers reveal why it’s risky — and smart alternatives.

By Maurie Backman Edited by Ellen B. Kennedy

Published 17 August 2026 In Features

(Image credit: Getty Images with Gemini edits)

Wealth Wise is Kiplinger's advice column on navigating retirement-related dilemmas. Got a question? See below for how to send it to us.

Dear Wealth Wise: We've saved almost $4 million: $3.2 million in retirement and a $500K inheritance from my father that we put toward education and has already grown to almost $800K. I'm 53 and my husband is 54. Our children are aged 16, 13 and 10.

My husband and I work full-time but want to retire in eight years once our youngest graduates high school. Staying in our starter home helped us save, but we outgrew it years ago. We have equity in our home we could use to upsize, but we'd triple our mortgage payments and take on higher property taxes and insurance. We're not sure how much additional money we'll be able to save.

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Can we just say we've saved enough for retirement plus college for three kids? In a few years, it won't make sense to upsize since our kids will be moving out. We've worked hard and would enjoy a bigger space. We're willing to downsize in eight years along with retiring. I see buying a bigger house as a very expensive rental to get more space while we see our kids through to college. — Cramped but Cautious.

Dear Cramped but Cautious: Saving for retirement often requires sacrifice. By staying in a starter home, you have clearly saved a bundle and understandably want to upsize while it still makes sense.

You may struggle to find something affordable. During the first quarter of 2020, the median U.S. home sale price was $329,000. Today, it's $410,700. That marks a roughly 25% increase. Throw in elevated mortgage rates, and it's no wonder you question if you can keep saving after upsizing.

But do you really need to worry? Let's see what our experts have to say.

You've probably saved enough for retirement

Moving to a larger home can feel like a risky financial decision when it means you don't have extra money to fund a retirement account. But Christopher Walsh, regional marketing director and financial adviser at Capital Choice Financial Group, says that assuming your future income needs aren't too outrageous, you're probably OK to stop contributing toward retirement.

"I would say for the most part, your work is done," Walsh says. "If your investable assets continue to compound around 9%, and if you follow the rule of 72, your retirement [account] should be near double what it is today."

Walsh says that if you also follow the 4% rule in retirement, that should provide an income of about $256,000 a year. Keep in mind that a 9% return may be too high a goal as you near retirement and invest more in fixed income. You'll also need to account for inflation. Still, with Social Security added in the income mix, you should have plenty to work with.

"For most people, that's an outstanding retirement income and should also empower you both to leave quite a legacy for your children," Walsh insists.

Watch out for the expensive college years

While your strong nest egg positions you well to hit the brakes on retirement savings, it's the college years that may trip you up, says Michael McSweeney, financial adviser at Ascend Wealth Partners.

"An $800,000 balance should go a long way toward paying for college," McSweeney acknowledges. Indeed, your family's college savings are far ahead of the average 529 college savings account balance, which had just over $34,000 at the end of 2025.

"That said, I'd be careful not to underestimate what the next eight years will look like," cautioned McSweeney. "Having three children close in age means there could be several years where college costs run $50,000 to $100,000 per year, or more, on top of their normal living expenses."

Given that you're looking at expensive college costs in the years leading up to retirement, the danger, says McSweeney, is being tempted to tap your nest egg to cover added expenses that arise, such as expensive off-campus housing or airfare to a distant school. That would still likely leave you with plenty of money to retire on, but it does change the math.

"That's why I would think twice about buying a larger home," McSweeney says. "The question isn't whether they can afford it. It's whether it makes sense to dramatically increase their housing costs for a home they already expect to sell in eight years."

As McSweeney points out, "A larger house doesn't just mean a bigger mortgage. It usually means higher property taxes, insurance, utilities, maintenance, and furnishing costs."

There may be options other than buying a new, more expensive home

Eager as you may be to upsize while you still have kids living at home, whether it makes the most financial sense is questionable, says McSweeney. His recommendation? Renovate your current home to make it more comfortable.

"A home equity line of credit could be a great tool here," McSweeney says. "They can tap into the equity they've built over the years to remodel the kitchen, update bathrooms, finish a basement, add usable living space, or make other improvements that help the house function better for a family with teenagers."

The payment on a reasonable HELOC, McSweeney explains, may be much lower than the cost of upgrading to a more expensive home. And that way, he says, if you want to downsize in eight years, you'll have an updated home that's easier to sell.

The downside? Because they’ve lived in this starter home so long, their capital gain may already be approaching the $500,000 tax-free exclusion for married couples. Staying put for eight more years means future appreciation may be taxed. (On the other hand, documenting qualified renovation costs will raise their home's cost basis, helping to offset some of that future tax bill).

The verdict: go for it (or renovate)

All told, you can probably afford to stop saving for retirement and college and buy the bigger house you've always wanted. But you'll need to decide if it's worth the potential financial stress.

"When you factor in transaction costs, mortgage interest, property taxes, insurance, maintenance, and moving expenses, they're spending a significant amount of money for something they already know is temporary. That's not necessarily wrong, but it's a lifestyle decision, not a financial investment."

If living in that bigger home is important to you, then you should go for it. You've earned it. But if you can make your current home work with a thoughtful renovation, McSweeney says, you'll likely enjoy these last few years with your kids just as much while keeping your monthly expenses lower, preserving more flexibility, and putting yourself in an even stronger position when it's finally time to retire.

"They've spent years making smart financial choices, including staying in a modest home while building nearly $4 million in assets. I wouldn't abandon that strategy just a few years before retirement," McSweeney says.

A word from Wealth Wise on college costs

One of the hardest lifetime expenses to plan for (aside from retirement) is college. We agree that $800,000 for three children is a robust college fund, leaving an average of $266,000 for each child. That's almost exactly what four years of private college would cost ($60,920 x four years), according to College Board Research (PDF).

Swipe to scroll horizontally

Average Annual Price for Private, Four-Year College in 2025-2026
Tuition and Fees	Tuition, Fees, Housing and Food	Cost of Attendance	Net Cost of Attendance (after grants, etc.)
$45,000	$60,920	$65,470	$37,380

The reality, however, is that few students pay full price these days. As the table above shows, the net cost of attendance is about $28,000 less than the "official," published cost of attendance. Even if your income is high, your child may qualify for merit-based aid. Moreover, your child might choose an in-state public school which is much more affordable; the net cost of attendance at a public college was $21,340, according to the same study.

Still, it doesn't hurt to have plenty of college savings. Your child might wish to take a gap year abroad before college starts or might need more than four years to complete their education. Finally, if one of your children wants to go to law school or study medicine, they may need to stetch their college funds into graduate school.

Disclaimer

Not all questions submitted will be published, and some may be condensed and/or combined with other similar questions and answers, as required editorially. The answers provided by our writers and experts in this advice column are for general informational purposes only. While we take reasonable precautions to ensure we provide accurate answers to your questions, this information does not and is not intended to constitute independent financial, legal, or tax advice. You should not act, or refrain from acting, based on any information provided in this feature. You should consult with a financial adviser regarding any questions you may have in relation to the matters discussed in this article.