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Taming The High Cost of College

Late Stage College Planning

college planning timeline

THCC Episode 154 – 529 Plans and the Gift of College

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Today’s Guest:

Patricia Roberts, COO of Gift of College 

As a former college student who had to borrow thousands of dollars in student loans, Patricia Roberts is no stranger to the struggles and perils of student loan debt. But she turned her experience into a positive.  

As an attorney well-versed with 529 college saving plans, Patricia successfully sent her child to college debt-free, so it has become her mission to help parents to do the same. Patricia wrote the book Route 529: A Parent’s Guide to Saving for College and Career Training with 529 Plans, an easy-to-understand guide for those considering 529 plans and other savings vehicles to prepare for higher education expenses.  

She also supports employers of all sizes in offering education-related financial wellness benefits through her company, Gift of College.  

Questions Answered Today:

What are 529 college saving plans?  

Authorized by Section 529 of the Internal Revenue Code, 529 plans enable families to have tax-exempted designated savings and investment funds for higher education purposes. This system allows families to save and grow money for college tax-free, as long as they avoid using the money for something other than its intended educational purpose.  

When is the best time to start a 529 college saving plan?  

Patricia’s family started when her child was a baby. That baby has recently graduated from college debt-free. Patricia hugely attributes this achievement to their 529 plan, along with their other smart money decisions as a family.  

The earlier parents can start a 529 plan, the better. But whether your kid is in daycare, primary school, middle school, high school, or even in college, it is never too late to open a 529 plan.

What’s special about 529 plans?  

While there are lots of strategies to pay for college, Patricia believes that 529 plans are worth considering. Here are some advantages of 529 plans:  

They’re not taxable investments, which means that they grow tax-free. If you use the money for its intended purpose—higher education—you’ll never have to pay taxes on the money or its growth.  

Even better: Some states offer annual state tax deductions or credits based on your 529 plan investments.  

Disclosure: Depending on your state of residence, there may be an in-state plan that offers tax and other benefits, which may include financial aid, scholarship funds, and protection from creditors. Before investing in any state’s 529 plan, investors should consult a tax professional. 

The account owner always maintains control over the account. Even if the recipient of the fund turns 18 or 21, it’s the account owner who retains full control over the money and makes decisions about when and how the money will be used. The account owner doesn’t have to be the student’s parents. It could be a grandparent, aunt, uncle, etc.  

They have low minimum deposits. You can open a 529 plan and have an initial deposit as low as $25 or less. Then you can continue to contribute in the future. 

There are no income limits and no time limits.  

529 plans are very flexible. They’re not limited to traditional colleges. 529 plans can be used for other forms of higher education such as:  

  • Trade and technical schools 
  • Cosmetology schools  
  • Culinary institutes  
  • Etc.  

Further, 529 plans can also be used for school-related expenses such as:  

  • Tuitions and fees 
  • Books and supplies  
  • Room and board (off or on-campus)  
  • Computers  
  • Etc.  

The funds are transferable. If the original beneficiary fails to use the funds, they can be used by another family member, which can include first cousins, step/half siblings, aunts, uncles, or, in some cases, the original beneficiary’s child.  

Disclosures: Investors should carefully consider investment objectives, risks, charges, and expenses. This information and other important information are contained in the fund prospectuses, summary prospectuses, and the 529 product program description. These documents can be obtained from a financial professional or directly from a 529 plan’s website. Please read them carefully before investing. 

What are some important things I need to know before investing in a 529 plan?  

Like any other investments, there are also some things families need to look into before opening a 529 account:  

If the money is spent for something unrelated to higher education, you’ll have to pay the tax that you didn’t pay while the account was growing in value. There will also be a 10% federal penalty on the earnings.  

The 529 plan may impact towards your student’s federal financial aid. If the account owner is the parent, a maximum of 5.64% of the funds will be counted towards the family’s expected family contribution.  

529 plans are not necessarily a savings account. Families should choose a plan depending on their objectives. If they want a safer path with low risk and returns, some plans have a savings account component. Most 529 plans are invested in the financial markets with the risk of either growth or loss.  

How can Gift of College help me when working around 529 plans?  

Patricia’s company, Gift of College, is a great platform to use if you already have or you’re thinking of opening a 529 account. Gift of College helps families in three ways:  

1. They have a platform where a student can set up a Gift of College profile and gather “gifts” for special milestones like birthdays, graduations, holidays, etc. Patricia compares it to crowdfunding where a link can be shared to families and friends to directly send monetary gifts that will go straight to the student’s 529 college savings account.  

2. They have gift cards (from $25 to $200) that are available at retailers all around the U.S. The person receiving this gift card must have a 529 plan to get the value of the gift card. Otherwise, they can’t use it.  

Patricia thinks that this is a good way to encourage family and friends to set up a 529 account, or at least encourage them to look into 529 plans and their benefits.  

3. They help employers offer 529 plans as an option for their employees. 65% of Americans are unfamiliar with 529 plans, so Gift of College offers their payroll deduction platform to partner with employers and encourage employees to use 529 plans as savings at work.  

What are some college saving strategies I can use to get started with saving?  

Patricia knew from her personal experience the struggles of incurring thousands of dollars in student loan debt, so she decided that she didn’t want her child to experience the same struggle. In order to do this, her family needed to be disciplined in handling money.  

She wrote the book Route 529: A Parent’s Guide to Saving for College and Career Training with 529 Plans to help out parents like her save for college, but below are some simple strategies she shared:  

  • If you spend around $50 to $70 for diapers, then save that money once your child is potty trained. 
  • Once your child is in full-time school, reallocate the money you used to pay for daycare.  
  • Cut those cable channels you don’t watch and save the money instead.  
  • Do you really need to buy a new car while the old one is still working?  
  • Have an honest conversation with your student. It will be hard, but you have to be realistic with your family’s financial capability. Talk to your student about:  
  • Not being emotional about the “dream school”  
  • Thinking of the financial implications for the next 10-20 years  
  • Picking a school that makes them feel good but is also affordable  
  • Encourage family members/friends to send monetary gifts rather than materials that are easily unusable. Patricia notes that this benefits both parties. Shopping is not easy, after all.  

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Brad Baldridge
Learn the basics of a 529 college savings plan and how to use gifts to fund them.

Presenter
You have kids, they grow up and before you know it, it's time to plan for college. Where do you start? How much is it going to cost? Will you qualify for financial aid? Should you be looking into scholarship? When will you be able to retire? What about student loans? The list of questions is never ending. The good news is all the answers are right here. Welcome to the Taming the High Cost of College Podcast. Here is your host, certified financial planner, Brad Baldridge.

Brad Baldridge
Hello, and welcome to Taming the High Cost of College. I'm your host Brad Baldridge. Today, we have an interview with Patricia Roberts, the COO of Gift of College. And in this episode, we're going to talk a lot about 529 plans. Now 529 plans have their positive and negative aspects. And there's some disclosures at the end of this episode that you need to listen to before you make any decisions around 529s. And there's certainly good things and bad things about 529s. In general, I think they have their place though. So in this interview, we're going to cover the basics of what 529 plans are. And then we're also going to talk about Patricia's company, Gift of College, and how her company is helping families and businesses give the gift of college by using gifting strategies to place money into a 529 for a student or a child, whether it's a child of an employee, or again child in the family. So instead of giving a bunch of gifts that the student may or may not need, you can actually give college money which again, anybody going to college will definitely need. As always show notes are available. And all the links that we talked about will be available in our show notes at tamingthehighcostofcollege.com/154. All right, let's go ahead and jump into the interview.

Today we're sitting down with Patricia Roberts. She is COO of Gift of College, and the author of Route 529, a book about college savings plans. And also mom, who recently had a college graduate. So welcome, Patricia.

Patricia Roberts
Thank you for having me here today, Brad.

Brad Baldridge
All right. So obviously you there's you've got a lot going on in the higher education and college space, both personally and professionally. So can you tell us a little bit more about how you got involved in all this and your journey so far?

Patricia Roberts
Sure. So by way of background as a young person from a low income family, I almost missed the opportunity to attend college because of costs. And I was ultimately able to attend and obtain both an undergraduate and eventually a graduate degree while working multiple jobs, the graduate degree at night while working full time. But I took on a tremendous amount of educational debt, and had a lot of it on my hands when my son arrived. In fact, his father and I owed over $100,000 in student loan debt. So we've got the background of having come to this with a lot of debt. I also have the background of really appreciating the power of higher education, getting those degrees really enabled me to lift my family out of the situation they were in in terms of the way they were living, and to really create a brighter future for myself. So huge respect for the many doors that higher education can open. In terms of my professional experience with these plans. I was an attorney at Citigroup in the late 1990s At a time when they were interested in getting into the 529 arena. These plans have been around over 26 years. And every state except for Wyoming has a 529 plan. And many of the states hire an investment management firm, to manage the investments of the plan and to help run the program distributed through financial advisors, etc. Citi was interested in getting into this line of business and I learned about it as an attorney. I learned about section 529 of the Internal Revenue Code. I happen to be pregnant with my son at that time. So it was an interesting assignment for me to receive. And having learned about it. I both helped Citi get two programs off the ground at the time. They won the mandate for both Illinois and Colorado and started working with those plans. And I was able to start saving for my own son because I had the knowledge of the plan. And as soon as I returned from that maternity leave, I opened a 529 account and I started contributing directly from my paycheck into it with the strongest desire that my son not wind up in the situation that his father and I were in with student loan debt. And really the rest is history, we started both his dad and I started putting small amounts into the 529 plan directly from our paycheck, the money never passed our hands. And by doing that, we really became quite disciplined. And over time, as we earned more money, and we eventually got those school loans paid off, we were able to contribute more and more and to invite friends and family to join us. And as you said, at the top of the broadcast here, I do have a son who has graduated from college, and he just graduated last June debt-free, largely due to our contributions to the 529 plan. And also due to our making some smart decisions as a family in terms of school choice. And what really worked for us in terms of net cost. Right, so lots of connections to this topic.

Brad Baldridge
Right? Absolutely. So, of course, you also, as we mentioned, wrote a book, you know, Route 529, which talks about 529s. But I guess, before we move on, there's probably a number of listeners out there, they're saying, 'Man, you know, I understand that you save when you have a baby and that kind of stuff, but I've now got a 12 year old or a 15 year old, and I can't go back and get started when I should have perhaps.' I just want to make it clear that 529s work certainly when you have a baby as you demonstrate, but they also work when you know, you got to 15, or 17, or even a kid in college potentially.

Patricia Roberts
That's correct, I feel strongly that it is never too late to get started with the saving process, especially for a goal, like higher education, I want parents to know that any amount that they can accumulate is that much less that their child's going to have to borrow and repay with interest. So no sense regretting that you didn't start sooner, just get started. And whatever you're able to accumulate is going to be helpful. And the more disciplined you can be, the more you can take a look at your current expenditures and see if there's any room to cut back, the greater the chance you will be, and being able to accumulate some funds that will be useful to your child. And, there's no need to worry about saving it all, I think most people don't do that. There are other ways. And I'm sure you talk to your listeners all the time about other ways to pay for higher education. But this is an important element to consider. And to not put off doing wherever you are in the process. Because time is valuable.

Brad Baldridge
Right. As I've said often, there's lots of different ways to attack college. But one way to think about it is there's two steps to the process. One is figure out the right school at the right price, and you're trying to get that price as low as possible. And again, I'm not saying everybody go to the cheapest option, I'm saying, if this, find the school that has the best price, and meets your needs, and sometimes it might be the expensive school, but whatever it is, you try and get that price as low as you reasonably can just like when you shop around for a car, right, you're not going to find a $2 car, you're going to have to pay a certain amount. Once you figured out what that price you're gonna pay is, the next step is to pay that price efficiently. And that's where 529s fall is, they can be a very efficient way to pay whatever you're going to pay for college, whether it's full price at a state school, or half price at a public or at a private school, or whatever it might be. Most of the time the parents end up paying a portion, whether that's a few $1,000 or a few $100,000, the 529s, I think, can add a lot to it. So I guess let's jump into the very basics, then obviously, you wrote a book on Route 529, which talks about college savings plans. So what are the biggest benefits of the 529?

Patricia Roberts
Sure, first of all, what's special about 529 plans is that they enable individuals to really earmark or designate funds for a particular purpose. So rather than mixing in savings, for college with savings for other objectives and risking that you're going to pull that money and use it for something different 529 plans really give you the chance to designate funds for this particular purpose. What's also special about 529 plans that I'd like to point out is that the account owner stays in control of the account versus once the child reaching age 18 or 21 and getting their hands on the money. That's not the case with 529, the account owner whoever it is, and it does not have to be the child's parent. It could be a grandparent, it could be an aunt or uncle, it could be someone What else, but that individual decides when and under what circumstances to disperse those funds on behalf of that beneficiary, so I like that. So we've got earmarking, we've got the account owner and control, we've got tax benefits. So these accounts, unlike taxable investments, while they're growing in value, the growth or the earnings are not taxed. So they're growing tax free. And in fact, if you use the funds for their intended purpose, and we can talk about what those purposes are, various forms of higher education, not just college, if when you withdraw those funds, they've grown tax-free when you withdraw them, if they're being used for one of these qualified purposes, you will never pay tax on the earnings. So what that means is, in my view, less tax means potentially more money for college. And even better 35 states and the District of Columbia offer some form of a state tax deduction or credit for contributions to these accounts. So if you happen to live in one of these states or the District of Columbia, you can get an annual tax deduction or credit that can be valuable to you as well. What else can I tell you about 529 plans, they often have low minimums to get started, many of the 529 plans have brought their initial deposit requirement down to $25, or even less. So low minimums, high maximums, there's a recognition that college is expensive, you can save several $100,000. In these accounts, if you happen to have that money. There's no income limits, as there are with other forms of saving and investing no time limits. And there's really a lot of flexibility in terms of use, not just for traditional college, as we may think of it, but also for trade and technical schools, cosmetology school, culinary institutes, many different ways you can use these funds, you can use them for tuition and fees, books and supplies, room and board if you're attending at least halftime room and board on campus or off campus, as long as you're spent attending at least halftime, and other requirements for attendance at college. In fact, computers can even be paid for with 529 plans if the student is using it for that purpose. So those are some of the highlights of 529 plans.

Brad Baldridge
Right? Absolutely. So that's all the good news. So what's the bad news? I mean, what do we give up? What are some of the downsides of 529s?

Patricia Roberts
Well, one issue that investors should consider is whether indeed, they believe the funds will be used for some form of higher education. So while you'll never lose the money, it always belongs to the account owner, you may have to pay. If you take the money out for some purpose that is not related to higher education, you will have to pay the tax that you, on the earnings, that you had not paid while the account was growing in value. Fair enough. You earmarked for this potential purpose, you didn't use it for that you're going to owe those taxes state and federal taxes. There is also a 10% federal penalty on the earnings only. So the tax is owed on the earnings only. And there's a federal penalty on the earnings only if you do not use this money for some form of higher education. What many families realize is that most young people pursue some form of higher education. Even those who don't, there may be a family member that can use the funds 529 under the Internal Revenue Code is pretty generous, it allows you to redirect those funds to another beneficiary who was a member of the family of the original beneficiary. And that goes all the way out to first cousins, it can be a step or half sister or brother, it could be an aunt or uncle that uses it. The parent if they happen to be the account owner can use it for their own adult learning. Or you can save it if your child's not using this money, you can save it for their children someday. So there's lots of flexibility if people are worried about not using the funds for higher education. There's lots of flexibility, but I think that's a consideration going into a 529 plan. The other there's a lot of myths about 529 plans because they're called college savings plans. People assume they're just for college. That's not true, and that they are a savings account. They are typically not a savings account. These dollars, typically, with most 529 plans, are invested in the financial markets. So there's certainly the possibility of growth and there's also the possibility of loss of funds depending on the performance of the financial market. Some 529 plans do have a savings component within them, you'll want to look carefully if that's your objective, that gives you a lot of safety, but not the potential of high returns, you're gonna get a much lower reward for having much less risk. But those are the things I would think about. Sometimes people are concerned about the impact on federal financial aid, by having savings earmarked for college. The reality is with 529 plans, as I said, the account owner controls the account, these are not considered the child's assets, they are considered assets of the account owner. And if the account owner is the parent, they count, only a maximum of 5.64% of that account value. So if you've saved $10,000, $564 of it, would be considered towards the expected family contribution. Whereas if you had money that was owned by the child, that's up to I think, 20%, or even more. So the pretty favorable in terms of federal financial aid treatment, there's always the possibility that a college looks at other criteria institutional aid, they can look at things like 529 plans and other assets as well. But I think the general wisdom is it's better to save than to necessarily be so concerned about the potential financial aid impact, particularly considering that financial aid is often largely comprised of student loans. So there is an impact. I consider it, fairly insignificant on the federal front, but it's something you do want to consider.

Brad Baldridge
Right? Okay, so that's a, I think, a good basic overview of 529. So when I'm working with families, I would say 529s are used, you know, probably 80 or 90% of the time in some form, as we're building a plan for college. Often we pair them with other types of accounts, as well like a Roth IRA or other other pieces as well. But a lot of times the core is a 529. Not always, obviously, they have their benefits, they have their drawbacks. But I think every family needs to consider them as part of the plan, because they have a lot of great benefits. And again, if you don't get the tax benefits, and some of those things, you don't pay taxes, because in your situation, well, then you get tax benefits don't help if you don't pay taxes. So there are situations where they don't work as well. But again, they I think they fit in. So your company Gift of College is kind of an additional layer on top of the 529. So you can you tell us a little bit about how Gift of College works. You know, now that we understand 529s are good, and maybe parents or grandparents or whoever may want to get involved in 529s. Tell us about the Gift of College and how that fits in.

Patricia Roberts
Sure. So Gift of College, giftofcollege.com is a platform through which individuals can set up a profile for themselves to indicate to others that they are on a mission to save for college. It's sort of like crowdfunding whereby you can set up a profile, enter in your information about the 529 plan to which you're saving, and share not the 529 plan information, but really a link to let people know for birthdays, holidays, other milestones and special occasions that you welcome contributions to the college savings account. So that's something that's special about Gift of College. I do want to mention many of the 529 plans themselves also have the ability for you to invite friends and family through their own functionality. So you don't necessarily need to use Gift of College. But it's a great way if your plan doesn't have it or if you want to supplement to what your 529 plan offers in terms of inviting others. It's a great way to do that. What's unique about Gift of College is we offer gift cards that can be purchased by friends and family and given to a potential student, a future student. Our gift cards start at $25 they go up to $200 in value. They're available at retailers around the US, soon to be at every CVS location. And individuals can buy those and give them to a future student for various occasions. So instead of asking someone to invite you to contribute to their 529 plan, individuals can give the gift card, I know I give them for every baby shower I attend. I'll buy a modest gift and I'll give a gift card and that gift card can be redeemed into any 529 college savings plan by going through Gift of College. So that's one part of our business, it's helping people save for college by making it convenient for them to invite others and by offering these gift cards

Brad Baldridge
Right, so

Patricia Roberts
In retail and online

Brad Baldridge
Right, and I think the key, or one of the key points is, if you use the Gift of College, the recipient doesn't have to already have a 529 plan, it might be the impetus to have them, investigate it and go start a 529 plan. So if you're an uncle or grandpa or something, and you want to give that subtle hint, you can give this card. And now mom and dad typically would need to go set up the account and put the money into the plan. And again, as you mentioned, you give it to everybody, and then we're certainly make sense. Again, if for strangers especially, it's like, you don't really want to start asking, again, not strangers, but someone that's not, you don't have intimate knowledge of I guess, is the way to say it, your colleague or something, you can give them the 529. And then they can go put the money where they want, they can invest it the way they want. They can choose the whatever plan they want. And they don't have to tell you anything about what they did, how they did it, which plan they chose, they don't have to send you any sort of links, they just get to go start the plan.

Patricia Roberts
Yeah, and I liked that about the gift cards, it really can spoil the surprise, if you're poking around asking people are you saving for college, can I help in some way. If you could just give them the gift card, if they are saving both redeem it into what they're already saving. If they're not, there's really nothing else they can do with the gift card, they will start saving, because they will know that they can redeem it into a 529 plan once it's set up. They cannot cash out the value of it and use it for something else. So I like that aspect of it. And many people do tell me that they got started because of that gift card. And I don't only give them for baby showers I give them for every child's birthday that I can think of, with a smaller, sometimes even $1 store type gift. Because I know how expensive higher education can be and how helpful this gift will be to that child, whether they realize it or not right now, and to their parents more importantly. So that's that's another line of business, the platform, the gift cards, and then we work with employers of all sizes around the United States by encouraging them to offer education on 529 college savings plans to their employees. And to consider it's optional, but to consider matching employee contributions to these plans. Gift of College has a platform that's easy for employers and employees to use. And we're having some success with encouraging employers to help their employees get started with saving, believe it or not, 65% of Americans say they are unfamiliar with 529 college savings plans, they've obviously not been working with Brad, and they don't know what they are. And if they do know what they are, they don't really understand them. So this is a really valuable benefit for an employer to offer. Particularly during this great resignation, where people are scrambling and finding new jobs and looking for things that are more rewarding. It really is helpful to offer this type of benefits. So we're finding employers are interested in it. And their employees are used to getting started with savings at work. They're used to retirement savings, maybe healthcare savings accounts. They're used to getting information at work about how to save for various objectives. And they're very grateful to learn about saving for college. So that's really one of the biggest focuses of my day job, the business that I work with.

Brad Baldridge
Right. Okay. Well, great. So that makes a lot of sense. As far as, again, if you happen to be a small employer, and you're looking for a benefit, and I think it's, correct me if I'm wrong, but I'm guessing it's a benefit. That's not quite so complicated. It's not like a 401k or providing life insurance or some of those other benefits where there's not as much paperwork, there's not as much rules as typical, it's more of a function of payroll versus a complicated purchase. Is that correct?

Patricia Roberts
That's correct. Yeah, it's very easy to line up an employer's payroll system with ours and to facilitate payroll deductions. What's great is with our platform, the employee decides for themselves which 529 plan they want to put money into, if they want to. The employer is not in the situation of having to pick a particular 529 plan to offer employers who have employees in multiple states, and particularly with now, people more and more people working remotely. They tell us they don't want to be in a position of offering just one 529 plan because they don't know because of these disparate tax treatment scenarios, which one is right for all of their employees. So they like our platform because it takes the pressure off of the employer, and just allows the employee to decide for themselves which plan they want. And employers are using our payroll deduction platform. And they're also using our gift cards. Interestingly, we were seeing that our gift cards were flying off the shelf in certain retailers. And we learned indirectly that in some cases, employers were buying them. So now we have a way to sell from our website directly to employers in bulk. And how are they using our gift cards. They're using them to welcome a baby that's born into one of their employees families, rather than spending money on a silver spoon or a really expensive floral arrangement, which will soon die, they are giving a gift towards higher education. Some of them I just learned, are using my book as well. They're given the book and the gift card. So the book to teach people about how to do it and a gift card. They're also using them for rewards and recognition programs. I think over 70% of employers have some way that they're rewarding people for work milestones going above and beyond years of service, etc. And they often give gift cards. So rather than giving the more traditional gift cards, which are for rent restaurants, and I don't know, maybe even Amazon and things like that, they're starting to include Gift of College gift cards as something that an employee can select for themselves. And some of the employers who are doing that are saying that employees really appreciate having that as an option. Because when they get the gift card, they can use it towards a 529 plan. They can also use it to pay down student loan debt, or gift cards work for either purpose.

Brad Baldridge
Right? Absolutely. All right. So as you mentioned, you've got your book out there. Can you tell us a little bit more about the book? As far as I mean, I do see it. It's here on Amazon. I'm assuming it's out there at other retailers. What's the, who should be reading the book? What is it about?

Patricia Roberts
Sure

Brad Baldridge
Can you give us some detail on that?

Patricia Roberts
Absolutely. So the book is called Route 529: A Parent's Guide to Saving for College and Career Training with 529 Plans. It is available on Amazon and I believe at other retailers as well. I wrote this book in 2020. During the pandemic, I had extra time on my hands on unexpectedly as many of us did. And I kept hearing on the news about student loan debt. And in addition to the really bad news about this pandemic, I kept hearing about, people were struggling with repaying student loan debt, and they were going to start putting payments on hold, etc. And I thought, no one's talking about how to avoid the student loan debt. Everybody's talking about whether it should be forgiven or waived, or how much higher education is, but nobody's really talking about how to plan for it. So I thought, why don't I write a book, I've got this professional knowledge of over 24 years now. I've got a son who's about to be a senior in college who would soon be graduating debt free. Why don't I share a little bit about my personal experience and incorporate my professional expertise, but do so in a way that it was very easy to understand. I think people sometimes find financial instruments to be rather complicated, incorporate the Internal Revenue Code, people get even more confused. But I tried to write it in a way that was really understandable. I didn't omit any of the important details, but I tried to put it in language that I felt parents could easily understand. I have key takeaways at the end of each section. And it really is not just about 529 plans. It's really about finding a way to prepare for this important future goal. I do talk about other ways to save and I compare and contrast. I talk about the mindset that is very helpful when you're planning for something that's so long term. And I spend a lot of time talking about why it is important to invite friends and family to contribute if you possibly can. I'll give tips on for parents with younger children who you know sometimes feel like there's no extra money to spare. I'll talk to them about the fact that when the child gets out of diapers, you were spending 50, 60, 70 dollars a month on diapers and diaper and supplies, just take that money, celebrate the kids out of diapers, they're potty trained, take that money and put it in an account. I figure over 15 years, 16 years depending on when the child is potty trained, whether at age two, three, whatever the age is, you can save over $15,000 just by having done that. I talked to parents in the book about you know when daycare expenses go away because the kids now in full time school. Consider reallocating some of that money. Just different ways. I share my own personal experience. My family drives a 22 year old car. We never got a new car since our child was an infant, and why did we do that we didn't want to spend money on things we didn't need, the car's still running, we cut our cable expense when my son was in middle school, we were spending a lot of money on TV channels that we didn't watch, put that money in the 529. So I share some of my personal experiences. And I also share towards the end of the book, when you're close to reaching your destination, what are some strategies that can help you to avoid or minimize student loan debt. And I talked about the importance of really being honest with your child and yourself about what you can afford, and what type of debt you're comfortable taking on, and why those decisions are important. You know, running after that dream school emotionally. And not thinking of the financial implications for 10, maybe 20 years to come, is not always the best idea. It's important to sit down and really have some honest conversations, we did that with our son, he knew exactly what we had saved. He knew based on the different schools, he had gotten into what that would mean, we could cover a portion of something that was very expensive. Some of the schools four or five years ago were like $75,000, and he wasn't being offered any aid. So we looked at what the implications were we looked at if he went to a state school, what that would mean. And we looked at the school that he attended Clark University in Worcester, Massachusetts, and the merit scholarship that they offered him, he felt good about that school, as he did about a few of the others. But when he looked at the finances, and really thought it through, that was a school that was going to enable him to come out debt free. And it was the perfect combination of a school that felt good, and one that was affordable. But we didn't skirt those conversations. Those are hard conversations for families to have. But I talked about it in my book, because I think it's important, there's a lot of disappointment when those admissions letters start coming in. And you've never ever conferred with the people in your life closest to you about how you're going to cover those costs. So if it's not too late, if you're not already at that, I know it's admissions decision time right now, if you're not already there, start that conversation early if you're there now, really think about how you're going to plan this. There are other ways to go. In terms of getting a degree, there are a lot of quality schools. As Brad said earlier, if one feels like a good fit, and it happens to be more affordable, you think you're going to, your child is going to get the education they need there, that might be something you want to consider graduate on time, by all means. Far too many students are switching things up and they're in school five or six years that comes with additional cost. And certainly tell friends and family that you don't want any more gifts that are easily outgrown or discarded and to start putting money help you and your child on this mission to save for college because they'll do it, people don't know what to buy your kid. They are struggling with that shopping is not easy. In or out of a pandemic, it's stressful. If you can just give them the easy and smart idea of helping you out. Everybody wins with that.

Brad Baldridge
Right? Absolutely. All right. So that was a good overview of the book. As mentioned, of course, it's certainly available at Amazon and where other books are available. I really do appreciate all the great information that you've given us. So where can we learn more if we want to get in contact with you or Gift of College's contact information, etc.

Patricia Roberts
Sure. So giftofcollege.com, giftofcollege.com, is where I work. Our website has those gift cards that can be bought online. There's also a section of the website that can tell you where to find them and retail based on your zip code. If you prefer to go in person to a store and get one. We also have information for employers on how they can offer higher education benefits such as 529 plans and student loan repayment assistance. So that's one way in terms of myself personally, I have a website called route, route529.com. And I'm on Instagram at route, route529mom, I'm also very active on LinkedIn. You can find my name Patricia Roberts along with Gift of College, but I'm out there I'm on a mission to educate other parents. I want parents to know how good it can feel to plan ahead, at least to some extent. And I want people to understand the existence and usefulness of 529 plans. I think people are remiss if they don't at least look into this.

Brad Baldridge
Right? Absolutely. And I think that's kind of one step that every family should take is to not only understand how 529 plans work, but also what's available in your particular state. And again, you may not use them you may have different ways to go but at least be aware of what it is that's available. So you can make an informed decision and some states now I'll just that kind of an aside, some states now are doing that similar thing where they're going to give you essentially a gift for getting started. So a few states are saying, if you set up an account for your recent newborn, then we're going to put automatically put some free money in there to get started, I'm seeing that pop up at a number of different states now. So yeah, again, the sooner you take advantage of it, the sooner it gets invested in, the longer it has to grow. So you can maybe get that same benefit for your 10 year old. And if you have a 10 year old, you probably should. But ideally, you do it as soon as possible. And do it now, whether it's a newborn, a 10 year old or an 18 year old for that matter, but just be aware that, this, what the states are offering is changing. Most states don't change that often, but between the 50 states, a couple of them change every year. And so it kind of try and stay on top of that, along with everything else you're dealing with college. So alright, well, thank you, Patricia. We'll stay in touch and it was a lot of great information.

Patricia Roberts
My pleasure. Thanks for having me. And I hope this helps your audience out.

Brad Baldridge
All right, that was a great interview with Patricia. As always, we can get our show notes at tamingthehighcostofcollege.com/154. And of course 529s have their benefits and they also have their downside, so pay attention and stay tuned for all the disclosures.

Presenter
Thank you for listening to the taming the high cost of college podcast. Now it's time for you to take action head to taming the high cost of college.com for show notes, bonus content and to leave feedback for Brad. The next step on your college journey starts now. Brad Baldrige is a registered representative of Cambridge investment research and an investment advisor representative of Cambridge Investment Research Advisors, a registered investment advisor. Securities are offered through Cambridge Investment Research Incorporated, a broker dealer and member of FINRA and SIPC. Brad owns two companies, Baldrige Wealth Management and Baldrige College Solutions. The Baldridge companies are not affiliated with Cambridge Investment Research.

Brad Baldridge
Disclosures. The information provided to you today is for educational purposes only. It is not intended to be specific recommendations or advice. Please consult with a qualified professional before acting on any of this material. Investing involves risk. Depending on the types of investments, there may be varying degrees of risk. Investors should be prepared to bear loss including total loss of principal. 529 college savings plan disclosures. Investors should carefully consider investment objectives, risks, charges, and expenses. This information and other important information are contained in the fund prospectuses, summary prospectuses, and the 529 product program description. These documents can be obtained from financial professional or directly from the plans' website. Please read them carefully before investing. Depending on your state of residence, there may be an in state plan that offers tax and other benefits, which may include financial aid, scholarship funds, and protection from creditors. Before investing in any state's 529 plan, investors should consult a tax professional. If withdrawals from 529 plans are used for purposes other than qualified education. That withdrawal could be subject to a 10% federal tax penalty, state penalties, federal income tax, and state income. Brad Baldridge's disclosures. Brad Baldridge is registered representative with Cambridge Investment Research. Securities are offered through Cambridge Investment Research Incorporated, a broker dealer, and member of FINRA and SIPC. Brad Baldridge is also an investment advisor representative with Cambridge Investment Research Advisors, a registered investment advisor. Baldridge Wealth Management and Baldridge College Solutions are affiliated. Cambridge and the Baldridge companies are not affiliated. The registered brand's location is at 10521 West Leighton Avenue, Suite 200, Greenfield, Wisconsin 53228.

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THCC Episode 150 – How to Send Your Student to College Without Losing Your Mind or Your Money

by

Today’s Guest:

Shellee Howard, Founder and CEO of College Ready  

Shellee is a certified independent college strategist and counselor. She helps middle and high school students (and their parents) prepare for the college admissions process. She helps them create a standout strategy, get into their best fit college without going into debt, and shows how to succeed once admitted.  

Shellee is on a mission to help a million people understand how to go to college, get into their dream college, and graduate debt-free—the same way she managed to send her kids to college.  

To make this happen, she founded College Ready and wrote the best-selling book, How to Send Your Student to College Without Losing Your Mind or Your Money.  

Questions Answered Today:

What is the first step in making sure that a student is on the right path to choosing a debt-free and right-fit college?  

There are three needs that families need to consider when planning for college:  

  • Academic fit  
  • Social fit  
  • Financial fit.  

When asked, most parents prioritize financial fit, while most students pick social fit. The immediate misalignment between what parents want and what students want is the common reason why families fall into college debt.  

For Shellee, to do planning correctly, addressing this difference and bridging the gap between students and parents’ preferences should be the first step.  

One mistake parents should avoid is waiting until their student gets accepted into colleges. This often results in either the student’s heartbreak or incurring debt as they find out about the college’s unaffordable sticker price.  

When buying a house, we must be pre-qualified, right? We only go for something we know we can afford. Shellee believes that the same principle should be applied when college planning.  

One good strategy for students and parents to meet halfway is while students focus on being the best version of themselves, parents should be making an effort in planning and strategizing financially.  

How do passion projects and community service lead my student towards the best career path?  

Most of the time, guardians ask their students, “What do you want to do?”—a question that’s often answered by “I have no idea.” 

As Shellee points out, students don’t want to be data dumped. They don’t want to be told what they need to do either. By immersing the student in real-world problems that they can witness themselves, they can be a better version of themselves, help the community, and have fun in the process.  

One of the strategies Shellee uses in helping students find their career path on their own is called A Passion with a Purpose Project. She does this for purposes that benefit not only the student but also the community. It’s win-win.  

Through their passion projects directed to the community, students discover what they’re really passionate about and how they’d like to make a difference. They learn things that aren’t taught in school (or anywhere) and start asking significant questions such as:  

  • Do I like interacting with elders? Or am I more inclined to caring for babies? 
  • Do I like to lead? Or am I more effective as a follower?  
  • Do I want to be out in the field doing something every day? Or am I someone who enjoys doing a desk job? 
  • What are my core values? What’s important to me?  
  • I’d like to help people with my words, what can I do?  

Simple realizations like these lead the student into choosing a major and eventually a career they would like to have and, most importantly, a career they would do best.  

Shellee also believes that this is the way a student would stand out and get rid of insecurities about somebody having better credentials.  

Remember: Anywhere the student chooses to go, there will always be a better somebody. But if the student fully realizes what they’re capable of, what they’d like to do, and why they’re doing it, they’ll have a fair chance of getting in.  

What faulty mindset around community service needs to be corrected?  

Families don’t think about college until later in high school, and that is considered late. 

It’s ideal for students to start as early as eighth grade because that’s the time when colleges start counting their community service hours. 

As long as the student is already mature enough to understand community service and its implications, parents can already start looking for opportunities to immerse the student in the real world.  

However, it’s also important to keep in mind that community services should not be done for the sake of putting them in the student’s portfolio. Community services are there to ignite the student’s passion and, of course, to make the members of the community’s lives a bit better.  

In the Common App (an application students use to apply to multiple colleges), there is a question that asks, “Tell me about a time you did something for somebody else that did not benefit yourself.” A student who has been doing community hours for years would look much more authentic than a student who started community service in their senior year.  

Why? Because a late start raises the suspicion that the second student only started doing community service for the sake of college applications.  

How do I take part in my student’s journey of being the best version of themselves?  

It’s always great to stay on top of planning and team up with experts to help with your student’s admission. College planning is not supposed to be taken lightly, and it should be considered a full-time job. In fact, it takes 20-30 hours weekly to do the planning.  

Brad compares this to a kid learning the piano—if you want your kid to learn to play, you get a piano teacher. The same thing should be done when planning for college. If you want your kid to get into the best school for them, you should consult an expert who would help them reach that goal.  

Therefore, a decision must be made: do parents want to do the planning full-time, or will they work with someone who knows the nooks and crannies of the college admissions process?  

Many parents make the mistake of thinking that their student’s high school counselor is enough support, but in actuality, high school counselors have a lot on their plate and can’t realistically manage thousands of kids.  

Experts like Shellee help parents with:  

  • Strategizing financially early (breaking down finances such as the school’s “sticker price,” explaining the idea of co-signing student loans)  
  • Talking to students about their college’s return on investment, asking questions such as “Do you want you and your parents to work for free, paying off your student loans?”  
  • Finding opportunities for students to do research, internships, and community service 
  • Strategizing in college selections (e.g. having reach, comfort, and safety schools)  
  • Directing the student towards the path they would like to take  

Another thing that parents need to understand is that there are tons of great colleges out there and that their options are not limited to big names. Shellee herself did a study about taking off-brand names and having students pick schools based on credentials alone. Students were shocked to pick a school that’s not even on their radar.  

While it’s great to get into the big schools, it’s always a smart idea to have a backup plan. Always remember that the school that’s the right fit for the student takes precedence over the school everybody wants. 

Lastly, parents must also realize that students only have an idea about professions their parents have. They know nothing about others. It should be a goal for parents to introduce their kids to as many professions as possible for them to have an idea of what other careers look like.  

What resources does Shellee offer to help me and my teen get started with strategizing?  

Shellee manages College Ready, where she and her team help students not only get into their dream school but also graduate debt-free.  

In 2021, College Ready’s 61 students managed to get over $10.7 million in scholarships.  

Shellee also offers a free copy of her best-selling book, How to Send Your Student to College Without Losing Your Mind or Your Money. The book is a great resource in understanding the rules of college admission as well as understanding the colleges’ academic, social, and financial fit to their students.  

For those who would like to buy it on Amazon, order a copy here.  

Links and Resources

Helpful Articles and Resources 

THANKS FOR JOINING US!

We’d like to extend an invitation to our listeners to share their feedback and questions. Contact us to submit a question.

If you find our podcasts helpful, please share us on social media and tell your friends!

The bottom line is that we care what you think and want to help you out, so we’d appreciate you reviewing us on your favorite podcast platform. Even better, receive automatic updates by subscribing to the show through your preferred podcast service. 

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Brad Baldridge
How to send your students to college without losing your mind or your money.

Presenter
You have kids that grow up, and before you know it, it's time to plan for college. Where do you start? How much is it going to cost? Will you qualify for financial aid? Should you be looking into scholarships? When will you be able to retire? What about student loans? The list of questions is never ending. The good news is all the answers are right here. Welcome to Taming the High Cost of College Podcast. Here is your host, certified financial planner, Brad Baldridge.

Brad Baldridge
Hello, and welcome to Taming the High Cost of College. I'm your host, Brad Baldridge. Today we have a great interview with Shellee Howard. She is the author of the book How to Send Your Student to College Without Losing Your Mind or Your Money. And she has some great ideas around helping your students stand out and finding a school that's a good fit, not just academically and socially, but also financially. So let's go ahead and jump into the interview. As always, we're going to have show notes available at tamingthehighcostofcollege.com/150 where all the links that we mentioned will be available. So here we go.

Alright, today we're talking with Shellee Howard. She's the CEO of College Ready. Welcome, Shellee.

Shellee Howard
Thank you so much for having me.

Brad Baldridge
All right. So CEO of College Ready, how did this come about that you got involved in working with students in college?

Shellee Howard
I guess the best way to say it is 13 years ago, it found me. My oldest was, he came home from eighth grade, and he's like, 'Mom, I know exactly what I want to do and where I want to go to college,' and he's so excited. I'm like, 'What happened today school?' He said, 'The counselor came, and we have to pick classes, and it really matters my first classes. So can I go to college? And can I go and I want to be a brain surgeon.' And I'm like, 'Well, sure you can.' And it was a mom moment of, 'Oh, my goodness, I was the first to go to college on both sides of my family. There's no medicine in my family. We have a lot to accomplish.' So fast forward. My firstborn did exactly what I asked him to do. I went back to school, and I got my certification at UC San Diego, and I started touring 25 colleges that semester, when he got up to give his salutatorian speech, the young man next to me said, 'Dude, I didn't even know that kid was smart.' And I said, 'Yeah, that was kind of the plan.' He didn't want to stand out as being that kid. And he had seven full ride offers, ended up going to Harvard, four years for free. Then decided, 'I'm going to try working.' He got a job working for Bain consulting, making $106,000 a year at 23. Then he decided to go back to medical school, went to UC San Diego, and now he's an orthopedic surgeon at UCLA. So my why started when my oldest started asking questions. And as a parent, I could not find the answers. So I made it my mommy mission to go and get those answers. And at the same time, I was a single parent. So even if he got in to one of those schools, I was a bit terrified on how I was going to pay for it. So my program touches on the academic fit, social fit, and financial fit because that's what I had to figure out for myself.

Brad Baldridge
Right, absolutely. All right. So obviously, you started figuring this out. When you say you visited colleges, what does that mean?

Shellee Howard
So going on college tours is the best way to truly get. We call it 'boots on the ground,' right? While we're seeing it, smelling it, experiencing it. So I literally went to 25 campuses a semester and went on college tours. I wanted to ask the questions myself, I didn't want to read about something on the Internet. The Internet is a very scary deep dark hole once you start going into college planning. So by talking to these colleges directly with admissions people, I realized there was a common theme. And with that theme, I built a strategy. So College Ready has used that strategy for 13 years and helping students not only find the perfect fit college but to do it without going into debt.

Brad Baldridge
Right. Okay. So can you tell us a little bit more about the strategy, then?

Shellee Howard
I would love to tell you about the strategies so what we do is we help families get very clear on what their needs are or their wants. Sometimes it's a need, sometimes it's a want. And so, you know, if I ask a parent, please rate this in order, academic fit for your students, social fit for your student, or financial fit for your student. It usually goes financial, academic, social. If I asked the student the same question, they will say social, academic, financial, this is why most people end up in some type of student loan debt. The parents are not aligning to the student and the students picking colleges based on their limited 17-year-old knowledge of how much debt they will get themselves into. So our strategy is to first align the parent with the student. And we help bridge that gap of having that hard conversation, how much the family can afford, or wants to afford, how much does the family want the student to go across the country? You know, when I went to college, my dad gave me two options. He said, 'One, you go there and you pay, you stay here and I pay.' It was, my dad just laid it out there, there was no guessing and there was no debt. He was like, 'I'm not going to take my retirement to pay for your college, I'm going to use my retirement to retire.' And I learned early on that the choices that we make when we're in our 20s affect us in our 50s and some beyond. So the strategy is first aligning the student and the parents, and then going after the ultimate goal, if it's an academic fit, great. If it's a social fit, which is quite surprising how many parents are okay with that one, you know, they pick a football school or a basketball school or a school on the beach. Like, there's a lot of different social fits, and then how does the financial fit because I have multimillionaires in my program, and I have need-based 'I can't go to college' in my program. And the beauty is we can help them all. There is not one perfect student, the only student that would not do well in our program is one who doesn't want to go to college. That's it.

Brad Baldridge
Right, exactly. And I think as professionals, we both run into that situation where college is the parents' goal, it's not the students goal. And that's a tough thing to solve, let's put it that way.

Shellee Howard
Yeah, and that's part of the equation. If we don't do it before they apply, the worst thing you can do is say, 'Oh, let's wait and see where they get in.' Now they get in and you get see the sticker price. And you're like, 'I can't afford that.' And now the student's totally deflated. Whereas if you pick the right match university or college before they apply, it's all celebration, and it all has a strategy. So it's really planning for their future, not winging it.

Brad Baldridge
Right. All right. So as part of this program, then how do we do this? I mean, seems like for many families, the college process is very challenging, and that they don't really understand what it's going to cost and, and any of that, and they don't realize that they're going to get the answer at the end. And then if they're shocked at the end, so how do you flip that around, then?

Shellee Howard
Yeah, I see it's like reverse engineering, you wouldn't go and buy a home without being pre qualified, without knowing 'I can afford this mortgage.' Right?

Brad Baldridge
Right.

Shellee Howard
I wouldn't go and buy a car without figuring out I can afford this car payment. Right. But for whatever reason, when it comes to college, people are not doing that strategy, which is something that we've been doing for years and years and years. And so it is work in the process. So I do it in two ways, that how-to is what you're asking. I built this cloud-based portal. And inside the portal is all my intellectual property. It's exactly how a student would work this process. Inside of there, we're working two completely different buckets. We have one bucket with how to make the student the best version of them they can be. Then we have the other bucket of how to get your financial house in order. What many families don't understand is the fastball looks at the second semester of the sophomore year and the first semester of the junior year. Well, if you start planning for college at the end of your junior year, you've just financially strapped your family because now you're trying to play catch up versus going in there strategically, with your best financial strategy. I work a lot with families on financial negotiations, financial reconsiderations, helping them understand why would you pay sticker price for college, if you wouldn't for a home or even for a car? So a lot of it is mindset, planning and strategizing. It's not that it's that far off, or there's some magical potion. It's just really looking at it, breaking it down, reverse engineering it, and then talking about what does that look like? Because many, many families don't understand there's a ton of great colleges. But yet everybody wants to apply to the same one. I don't know if that's lack of depth of knowledge, or it just is what the semester doing. I haven't figured that out in 13 years why that happens. But it is true that it does happen. So I have to help them. So for my master's thesis, I took all the labels, the brand names off at the universities, and then I had students pick the university based on the details of the major of getting out in four years of the financials of all of that stuff. Then I put the label back on, and they were shocked that that was not even on their radar. But yeah, it was the perfect fit school once I took the label off. So it's educating students, that there's more than just the school everybody talks about. Now, don't get me wrong, I mean, this year, we've gotten students into Stanford, into Yale, all of the big schools, but this is a perfect example of not having a backup plan. So this year, Berkeley is in a really tough position. And they're only going to allow 3000 students into admittance, which is an extremely low number for them. If that was the only school or the dream school for that student, they're now in a very bad situation, where we have reach schools, comfort schools, safety schools, and we have statistics that show that our students get into 9 out of 12 of those, why not 12, then you don't dream big enough. So it's helping families understand that just applying to the UC is not a strategy. Everybody does that because it's as easy as clicking a bunch of buttons. So that right there is where people have a tough time navigating this process, because it takes about 20 to 30 hours a week to do this properly by yourself. With me and the student, it's about one to two hours a week, who wants to do 30 hours a week on top of their full-time career, they would rather go, 'Oh, we'll wait and see where they get in.' But the student is not getting help from anywhere else. And that's the tragedy. I was presenting to the National Charity League two nights ago, and just out of curiosity, I said, 'Ladies, raise your hand, if you've seen your high school counselor, in the last year and a half,' not one hand went up, not one. So the high school counselors are just struggling with depression and anxiety and kids not wanting to be in school. And these kids are not getting support. And these families are believing that they are, and that's a part of pointing at each other and going, 'there's no support for them.' And they don't know how to do this, the parents don't know how to do this. Because even if they went to college, it's so incredibly different.

Brad Baldridge
Right? For sure. So you mentioned a few things in there where the whole college process, to do it well is very time consuming. And that's the analogy I use for people is it's kind of like the job that you do for a living. Often people say, 'Well, how hard can it be you just blah, blah, blah, blah, blah.' Yet, when you're in the job and you do it, you immediately say, 'Yeah, well, you don't know all the nuances and the problems' and the all, you know, it's much more complicated than what you just said, for sure. And obviously it is, because it's somebody's job, if it was that simple, they wouldn't hire someone to do it.

Shellee Howard
Right.

Brad Baldridge
And I think with college, we've just upped the complexity a lot, the price a lot. And now all of a sudden there's a lot more reasons to get it done. Well, I mean, when you and I went to school so many years ago, wasn't unusual to run into the kid that was on a six-year because he changed his major three times and he was struggling with what he wanted to be when he grew up. And again, it was a little bit of his time and a little bit of money, but it wasn't a big deal to add a couple of years. Now, parents hear something like that, and they almost have a heart attack. You know what, in extra two years I could barely, normally want to think about the four I'm on the hook for now. So how do appearance again, deal with figuring out how much is the right amount of effort in any particular area. So you could spend hours and hours and hours in scholarships, you could spend hours and hours and hours in visiting colleges, you can spend... So how do you figure out a reasonable, I guess, to-do list that doesn't drive you insane?

Shellee Howard
Yeah, that's a great question. So I use two analogies for that. So people can have a clearer understanding. The first analogy is, you could do your taxes, or you hire a professional to do your taxes. So you're not bogged down with learning tax code and getting overwhelmed with, 'Oh, my gosh, what are real deductions? What are not real deductions? And should I be an S-Corp, a C-Corp an LLC?' That makes my head want to explode? So I hire a CPA to do that, for me, just preparing my receipt for the CPA overwhelms me, right? I don't like to do that work. It's same for college, right? If you want to do it all yourself, you're now walking in the shoes of a professional. And so you need to get clear on how much time you have for this. Because if you don't have time, then it's best to be realistic. The other thing I equate it to is this one, if you're a business owner, and you're hiring for a job, and two people come for the interview, one of them has a zero anything on their resume. And the other one has three pages of incredible depth to their resume, which one are you going to pay more?

Brad Baldridge
Obviously the one that seems like they know what they're doing?

Shellee Howard
That's exactly it. So how much is too much? Or what should I be preparing? How much money do you want? What college do you want to go to? It's the same concept as preparing for life. You have depth of experience, you have amazing essays. If you don't have experience, your essays are going to not be very powerful. So helping families understand that this is not just planning for college, it's planning for their future. So all of the students in our program do what's called 'a passion with a purpose project.' Not only because do I believe that every student benefits from serving their community, and if they did, our world would be a better place. That's just my philosophy. The reality is why students do it is because they learn, do I like to lead or follow? Do I want to be at a desk? Or do I want to be out doing something every day? Do I like the elderly? Do I like babies? When these teenagers are serving other people,they're figuring out their career and their major without an adult? Same? So what do you want to be when you grow up? And they're like, I don't know. But when they're doing things versus just feeling stuck, it opens up their world to receiving what are they really good at. So we do things very differently than any other college consulting firm. And that is, we focus on the student and making them the best version they can be while having a enjoyable experience. I always say you can drip the information or you can firehose it and high schoolers prefer the dripped information. They don't want to be data dumped. So we do this process, when you ask that 'how', this is part of how we do it. And this is what helps the students stand out individually. The reality is, right, the student needs to stand out because somebody is going to have a higher GPA, somebody's going to have a higher test score, somebody is going to have more community service hours, somebody is going to have more leadership, somebody's going to have a better letter of recommendation, somebody's gonna have a better essay, don't worry about all that. Just be the best version of you. And the hard part is students don't know how to do that. There's no class they've taken. There's no seminar. And so we work with our students one to one and help them figure that out. What are their core values, what is important to them, they have been brought up in a world that they're pretty lucky. And for the most part, most students have a lot to be grateful for. And they don't think what it takes to provide that. They just grew up in it, it's their norm. But when I talked to them about a return on investment, they're very confused when I asked them how long do they want to work for free. And I said, they're like, 'I don't want to work for free.' And I'm like, 'Now you understand college loans.' 'Well, that's okay. My parents can take the loan.' Okay, 'So how long do you want your parents to work for free?' 'Well, I don't know.' So there's no connection for that teenager, or 95% of them that I've ever talked to. There's not that connection of paying this back. It's like, 'Yes, that sounds great. I would like to do that.' The other thing I'm finding out recently, as parents don't understand that they have to co-sign, that that student cannot get that loan on their own because they don't have collateral.

Brad Baldridge
Right.

Shellee Howard
So now the parents are going, "Well, wait. I'm not going to co-sign.' And that's where all of this starts to blow up, if they don't plan and strategize it ahead of time, because now they're in a position of adversity versus being the Dream Team. And that's where a lot of this can be stopped if students just plan and strategize.

Brad Baldridge
Right, absolutely. So if you're talking about passion projects, and doing these types of things, when does a typical family need to get started on all this, too? Again, that'd be the fire hose situation where, 'Oh, geez, I have a passion project. And I've got three weeks to get it done, because my applications are going out soon.' That doesn't sound like the right strategy. So how does it work from a timing standpoint?

Shellee Howard
So this is the challenge. Some students just don't start thinking about college, until later on in high school. If you want to know when's the perfect time, when your student is mature enough to understand community service. There's a question on the Common App that says, 'Tell me about a time you did something for somebody else that did not benefit yourself.' Okay, if we know that's a question that's been there for the last seven years, would it not be wise to start planning that as soon as possible? So people often ask when is the best time, the best time is when they promote from eighth grade? Because that's when colleges allow them to start counting community service hours. So why would you wait until you're a senior, and they can see that you did it all your senior year, it's like ding, ding, ding, I did this for my college application. That's not what they want to see. They want to see that you've started it, and it built and built and built, and then you handed it off. And so our students, they find this whenever. 70% of our students come from referrals. So we're only successful because of our referrals. And what does that mean, we're successful. And that's why people want to refer us. So we tend to get the second child after the parents try the first child and go, 'That didn't work out so well. I am now in massive debt. And I can't do this again, because we seriously can't afford it.' And so I'll get the second student. And luckily, they have either heard of me or I got their student later, and they wish they would have started sooner. But it's never too late. It really is never too late. If they start early, it's gentle, it's drip, drip, drip, no mistakes. Everything is simple and strategized. I have students who start their freshman year, their sophomore year, their junior year, I have students every single year who come to me begging for help the last two weeks before applications are due because they thought they had it. And the reality is they're buried. So it's whenever the family hears this, they're like, 'I had no idea that this was even available.' And that's how it was for me. 13 years ago, I wasn't apparent. I've had four kids. First one medical school, second one nursing school. Both of them did it debt-free. But I had to be very proactive and strategic about it. So now, I tell people if you start early, great, if you start late, we just have to move faster and hope that they can handle it and they're mature, and they can run with it and fix all of the gaps. Because that's usually where the problem is. And if people want money from colleges, you can't just do it at the last minute. It's like preparing for an interview and not having a suit to wear. It just doesn't work out in your favor. that you aren't going to be ready for that opportunity. So it comes down to, obviously, the sooner the better. But the reality is, it's never too late

Brad Baldridge
Right, now, and I'm sure you've heard this in the past, but I hear a lot of parents say things like, 'Well, we can't do anything because little Johnny or little Susie doesn't know what they want to be when they grow up, or they can't pick a college. So we're just waiting until they figure that out. And then we'll get started.'

Shellee Howard
I hear that all the time. I would say 75% of little Johnnys and little Susies don't have a clue. And why would they? I mean, how would they, if the parents not doing the job, their dream job, they don't know what other jobs are out there, right? If they haven't seen somebody doing what they're doing. So what do we do, we put them in front of that. We help them to find internships and research projects and do community service. Because when they're serving their community, the focus is not on them and their failures or potential not being good at something. Teenagers don't like to fail. That is something that is across the board, they don't want to put themselves out there and fail. But if I could help them understand that, without them, these people's lives are going to be way worse, so whatever they can do is a huge blessing, they go into it with, 'Well, I got nothing to lose,' now they're ready to play the game. And everybody wins, the community wins, the student wins. And yes, ultimately, it's a win-win. I have students in my program that the light bulb goes on, at some point, it's when they have the opportunity to do it. I have students who didn't know what they wanted to do, we started a passion project. And what they found out is, 'I love blogging, I want to be a journalist, because I can help these people with my words, or I want to be a certified nursing assistant, I love to help patients bedside.' There's a zillion things they can be doing. But students aren't going to be like, 'Yeah, I want to challenge myself in an area I have no clue of what I want to do. And I want my parents to navigate it.' That's disaster. I don't know about parents out there. But my poor, I had to hire them a consultant to just tell them what I wanted them to hear. Because they heard, 'Clean your room, do your homework,' and so on and so forth. So a lot of it is how you present the message, a lot of it's how they receive it. But they do want this, I I've only had two students in 13 years, who told me, 'My parents are making me do this, and I don't want this, this is not what I want to be doing.' And okay, so now what is that, and then we just go a different direction. And it's great. We still need a strategy and a plan. It may not be college, but it may be trade school. So students, a lot of times are scared to tell their parents, 'I want to be an artist,' because they know that parent doesn't want to pay $70,000 a year for them to go to art school. But when I say that sounds fantastic. But if you owned an art gallery, and they're like, 'Yeah, let's do that. How do I do that? Oh, a business degree would be the first step.' The student's like, 'That's great idea. How do we get started?' So it's just helping navigate them and not telling them 'No' without judgment, because ultimately, I just want what the family wants. I want the child to be successful. And so I can help them navigate that way. You know, a lot of times I say it's like a vocal coach, or it's like a sports coach, when the student wants to learn to be better. It's all good stuff, when the student doesn't understand why, they do not want to play the game.

Brad Baldridge
Right, absolutely. So I think that's the, when you mentioned coaching, I think that's the realization that parents may need to make is that, and I've probably said this on a prior podcast, but if your student came to you one day and said, 'You know, I'd really love to play the piano.' Most parents would think about that and say, 'Okay, well now I guess I've got to go learn to play the piano so that I can teach my kid or maybe I can find a piano instructor right? Or maybe we can find some online courses that will teach them piano.' But there's many ways to do it. When I think when it comes to coaching kids around what they want to be when they grow up, and how to do the college process and how to choose majors and careers. I mean, most parents didn't have that opportunity to get that type of coaching. And therefore, and quite honestly, it didn't exist 25 years ago either. But there was a time when a piano instructor didn't exist, and a batting coach didn't exist, and a vocal coach didn't exist. But now they're all available. And I think it's that shift where parents aren't aware of all the different types of help, that can be out there. And again, with the goal of 'Let's do this better', the piano instructor, not only do they know how to play the piano, but if they're a good instructor, more importantly, they know how to teach piano, which could be a completely different skill. And that's where I see people like you, I work a lot with parents, and the idea of working with students just scares me a little because I don't think I could add value, I don't think I could connect with a student very well, I connect really well with parents. But I have had those meetings with the 17-year-old who's kind of deer in the headlights kind of like, 'Mom made me come,' and it's not a very good feeling. So I'm glad you guys are out there that can get help with all this. And of course, the stakes are higher now with college being more expensive, and, and everything else as well. So if people want to learn more about what you do, and how you can help them, how can they reach you or find you?

Shellee Howard
So the easiest place to find me or College Ready is on our website. And that's www.collegereadyplan, so it's P-L-A-N dot com. And I intentionally put that in there. Because that's really what we're doing is we're planning and strategizing. I'm all over social media, and my website has all of the links to me. If your listeners would like a free copy of my best selling book, How to Send Your student to College Without Losing Your Mind or Your Money, I am happy to give that to them by going to book B-O-O-K dot collegereadyplan dot com. And that way, they can have at least the rules to the game. Right? They may not understand how to play the new game, but I share these are the rules. These are the things you must understand to navigate this process, then they can decide, do they want to be the college coach? Do they want to be the financial coach? Do they want to be the social coach, like do they want to wear those hats, but the book is free to them so they can, or they can go to Amazon and buy it, whatever they choose. But it's my gift to your listeners because I want, my mission is for a million people to understand how to go to college, get into their dream college and graduate debt-free. It is not easy, but it is possible. And that is what I am on a mission to prove. You know, last year in 2021, our students earned over $10.7 million in scholarships. That was 61 students, not the stock market can give you that return on your investment.

Brad Baldridge
Right.

Shellee Howard
So helping families understand that, yes, this is an investment but it's bigger than hockey lessons or club soccer. This is a lifetime of strategy and launching them. So I would love the opportunity to offer your listeners that book to get them at least the rules of the game.

Brad Baldridge
Right. And we'll put all the links you just mentioned in the show notes. So if you're driving or whatever, you can always go to our website and and grab the links as well. All right, Shellee, well, I really appreciate all the great information. It was a good chat with you and we'll stay in touch.

Shellee Howard
Thank you so much for having me.

Brad Baldridge
All right. That's our great interview with Shellee. Hopefully you've learned a ton. As always, we appreciate any sort of reviews that you can give us in iTunes or wherever it is you're getting your podcast. That's all we have for this week, we'll talk to you next week.

Presenter
Thank you for listening to Taming the High Cost of College Podcast. Now, it's time for you to take action. Head to tamingthehighcostofcollege.com for show notes, bonus content, and to leave feedback for Brad. The next step on your college journey starts now. Brad Baldridge is a registered representative of Cambridge Investment Research and an investment advisor representative of Cambridge Investment Research Advisors, a registered investment advisor. Securities are offered through Cambridge Investment Research Incorporated, a broker dealer and member of FINRA and SIPC. Brad owns two companies: Baldridge Wealth Management and Baldridge College Solutions. The Baldridge companies are not affiliated with Cambridge Investment Research.

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THCC Episode 133 – College Planning Strategies and Timelines

by

Today’s Guests:

Todd Weaver, President of Strategies for College, Inc.

College planning is a complex and overwhelming process for many students and families. Through Strategies for College, Inc., Todd Weaver helps them provide structure and guidance by creating a “game plan” to run. His company does this by helping families discover where they are unknowingly and unnecessarily leaking money. For 30 years, Strategies for College has been helping families with college affordability, visibility, and finding the right social fit for their student. 

Questions Answered Today:

When is the best time to start college planning?  

One of the most important things for families to keep in mind is that the college planning timeline is different for parents and students.  

Parents typically take care of the financial matters, so parents should start planning before the onset of their student’s sophomore year in high school. This is because the tax year the colleges will consider when the student applies for college will be during the student’s junior year. For example, if you’re applying for college and filling out the 2023-24 Free Application for Federal Student Aid (FAFSA), your parents’ 2021 tax return will be used to determine financial aid eligibility. So if you’re going to make any financial adjustments to help increase your family’s chance of qualifying for financial aid, you need to start planning early, in what Brad calls the “prior-prior year.” 

For students, the best time to start planning for college is after taking the PSAT or PreSAT practice test in the fall of your junior year. This timeframe should give them six to eight months to:  

  • Think of the reason they’re going to college 
  • Visit some campuses 
  • Start gathering some admissions requirements (e.g. college essays). 

This is critical because, when they become seniors, the application season officially starts for students. They write college essays, apply for financial aid, make more college visits, and deal with many other requirements. If they have already done some work in their junior year, the senior year won’t be as busy and stressful.  

Also, it’s important for students to know what college really means. A longer planning time period gives them time to develop that understanding and the readiness they need as they start with college applications.  

Tip: If you can’t visit colleges in person, video campus tours are a resource worth checking.  

“We pay for college with time, with money, and with stress. If we don’t start early enough, then the stress goes up. Often, the costs go up because we didn’t put the time in.”  – Brad Baldridge 

How do I work on my finances if I’ve been affected by the pandemic?  

Earlier, we talked about how colleges consider tax returns from two years prior to the time when the student is submitting the FAFSA. That means that if you have a student applying for college next year, in 2022, colleges will scrutinize your 2020 taxes.  

This is an issue for families who were hit hard by the pandemic or any new circumstances, such as the following:  

  • Job loss 
  • Business closure 
  • Divorce 
  • Anything similar that affects your income and assets. 

Obviously, their 2020 financial situation would be different than now.  

Now, if you’ve experienced any of those listed above, this is for you. Below are the things you can do: 

  1. Look for financial aid officers for assistance. Luckily, colleges have them at your disposal. So the next time you accompany your student to a college visit, bring your tax returns and ask about the potential need-based and merit-based aid for your student. Brad notes that colleges can be flexible with financial adjustments. Just ask and prepare proper documentation.  
  1. Do not assume that you’re ineligible to get financial aid. Todd says this is a typical scenario for families. They base their eligibility on their prior experience or someone else’s experience, which is a mistake. Remember that colleges treat each family differently.  

Scenario: Two families apply for financial aid. Both have the same house value, live on the same street, use the same car, and have the same salary grade. Family A qualifies, while Family B doesn’t. Why? Because Family A has a lot of consumer debt, but Family B doesn’t.  

The bottom line is, don’t listen to anyone (i.e. friends, family, non-experts) assuming your family doesn’t qualify. You don’t know (and they don’t know) unless you actually try and apply.  

  1. Involve other experts with your financial planning. You can work with a college financial aid officer, but there are other experts you can turn to for help. These include:  
  • Your CPA or financial advisor 
  • A college financial advisor (such as Brad or Todd). 

With your student, schedule a meeting with one of these experts to see what your actual numbers look like. This is important because you don’t want to waste time pursuing colleges that turn out to be unaffordable and out of budget.  

  1. Do your own research. The following questions should help you figure out where to look:  
  • What’s the cost of the local college? What’s the cost of private schools? How much financial aid and scholarships can they provide? Start by visiting Brad’s Cost of Colleges page and choosing your state. You’ll see real data on what families paid on average at the schools in your state, based on their family income.
    • Looking at these costs allows you to compare schools and find out which ones offer the most value with the least cost. 
  • What do colleges’ websites say about their costs? Are their prices updated?
    • All colleges have an EFC or SAI calculator, which provides an estimate of what colleges think you can afford to pay toward college. Check that out but also verify the numbers with the colleges themselves. 

What happens if I’m just starting to plan and my kid’s a senior? Is it too late?  

Todd says, “It’s not the end of the world, but you’re getting pretty close to the edge.”  There needs to be some damage control. For Brad, this includes:  

  • Getting to a college that accepts late application and transferring the following year. Take a look at the following scenario:  

Scenario: Out of the 7 colleges the student applied to, 5 said no. The other 1 put  the student’s name on the waitlist, while the other 1 is really expensive. When the   parents sought help, they were advised to just get into any college that accepts late  application and transfer the following year. 

  • Taking a gap year  

On the other hand, here are Todd’s recommendations:  

  • Get your student to think of prospective colleges. Visit some colleges. You can ask questions such as:  
  • Do you want to go to a big city college? 
  • Do you want to be in a big school? 
  • Do you have any major in mind?  

Obviously, you also have to think of finances. Look at these tips that may or may not help you but are still worth trying to improve your financial aid eligibility:  

  • Use cash to pay off credit card debts.  
  • Report bonuses (and similar income) at a later date (e.g. putting off receiving your bonus until January of next year instead of December of this year). 
  • Zeroing out the student’s bank account and putting the money in mom and dad’s instead.  

Now, before making these adjustments, be sure to check first if you qualify for financial aid in the first place. Again, you can do this by inquiring with colleges. 

How has the pandemic changed the college testing system?   

The pandemic has made testing difficult for students. Hence, many colleges decided to waive testing for the incoming batch. Many colleges removed testing for the academic years of 2021 and 2022, but they don’t really have concrete plans for 2023 yet. Here are the current situations for some colleges:  

  • California’s UC System doesn’t require test scores at all.
    • California appears to be working to build their own testing system 
  • Florida requires testing for their scholarship programs. 
  • Georgia currently requires students to test.  

If it varies by state, what’s the absolute rule in testing for 2023?  

  • Reach out to colleges. That’s the only way you’ll know how testing affects your admission. Ask the following questions:
    • What is your test policy for admission? 
    • What is your test policy for scholarships, state aid, etc.?  
  • Assume you will test. This helps students develop their test-taking skills and avoid being complacent because “they can opt not to test.” 
  • Remember that colleges’ policies change. As a rule of thumb, do the following:
    • Ask now. 
    • Ask when you visit. 
    • Ask when you apply.  

What other helpful resources will help me with college planning?  

  • Listen to college planning-related podcasts. Many parents don’t know that help is available. You need not to look far, Taming the High Cost of College has you covered!
    • Check out Todd’s website, Strategies for College. They have a free learning center that will help parents and students get started with planning.  
  • Check out Beth Walker’s Never Pay Retail for College. It contains some great tips for parents that should help ace the game we all struggle with—college planning.

Links and Resources

Helpful Articles and Resources 

Strategy for College’s Contact Info 

THANKS FOR JOINING US!

We’d like to extend an invitation to our listeners to share their feedback and questions. Contact us to submit a question.

If you find our podcasts helpful, please share us on social media and tell your friends!

The bottom line is that we care what you think and want to help you out, so we’d appreciate you reviewing us on Apple Podcasts, Spotify or your preferred podcast platform. Even better, to receive automatic updates, please subscribe to Taming the High Cost of College on Apple Podcasts, Spotify, or wherever you listen to your favorite shows.

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Brad Baldridge
Welcome to Taming the High Cost of College. In this episode, we're going to talk about some practical tips on how to pay for college.

Presenter
You have kids, they grow up and before you know it, it's time to plan for college. Where do you start? How much is it going to cost? Will you qualify for financial aid? Should you be looking into scholarships? When will you be able to retire? What about student loans? The list of questions is never-ending. The good news is all the answers are right here. Welcome to the Taming the High Cost of College Podcast. Here is your host, certified financial planner, Brad Baldridge.

Brad Baldridge
'Right, welcome back to Taming the High Cost of College. I'm your host, Brad Baldridge. This is Episode 133, when you're looking for show notes, today, we have Todd Weaver. He's the president of Strategies for College. Todd and I are going to talk a little bit about some of the frustrations we see and some of the strategies we recommend for families to get started in order to pay the lowest cost they possibly can for college. Again, we recommend things like getting started early and other obvious things. But we also explain what does that mean as far as what is actually 'early.' We'll get into some of the details as well. Todd also has some free resources on his website where he's got some free video learning courses. So I encourage you to go check that out as well. You can get links to all his information at tamingthehighcostofcollege.com/133. Again, that's for the Episode 133. If you're enjoying these podcasts, and you're learning a lot, please share them with your friends and family. Again, most people don't know this type of planning exists. That's our biggest challenge. So if you can help us get the word out, let other people know that they're not alone, that there are resources available, I would appreciate it. Alright, that's all let's jump into the interview.

Brad Baldridge
All right, today I'm sitting down with Todd Weaver. He's the president of Strategies for College. We interviewed Todd many years ago, and we thought we'd bring him back. Today we want to talk about some practical tips that families can use. So welcome, Todd.

Todd Weaver
Thank you, Brad. It's good to be here.

Brad Baldridge
Yes. So tell us a little bit more about Strategy for College and who you are and what you do.

Todd Weaver
I'd be happy to. Strategies for College is a company that's been helping families on college affordability, visibility, and in finding the right social fit for over 30 years. We started in 1990. And I've been working since then to help up students line things up on the money and the admission in the right fit for that time frame there. I joined the group about 16 years ago, after having spent some time working in a financial aid office myself. So I I saw how things were done on the inside at college and wanted to help people understand how it works from their side of the of the house.

Brad Baldridge
Right? Absolutely. So, I guess you and I are both have quite a lot of experience in dealing with the college money side of things, as well as some of the basics on admission and all that type of thing. So our goal today is just give people some quick actionable tips, you know, around various problems and issues that arise. So I guess to start with, let's talk a little bit about one of the biggest challenges that you and I were talking about, which is people not really understanding the timeline. So I think there's a problem out there where, again, I what I've seen and get very frustrated with is when people, they come senior year of high school saying, 'We are working on this college, we are struggling to figure things out.' What's your recommendations as far as when's the really the better time to start? I mean, senior year, we would both agree, it's probably too late to start, we should be finishing at that point, not starting. But what kind of timelines do you typically encourage if you get to pick, so to speak?

Todd Weaver
Well, that's a great question. And I think it can vary from participant to participant. You have the parental side of the conversation is typically where I start the conversation on money. And I think that should really happen ideally before the onset of sophomore year in high school. And the main reason behind that is because January 1st of a student's sophomore year in high school is when the clock starts ticking. And by that I mean that's the tax year that the colleges will see when applying for financial aid two years later, when their student is a senior. So if a family has to prepare anything to make themselves, best suited for the college financial aid consideration, they want to have it done have a clean slate before December 31st of sophomore year of high school. Students on the other hand, typically love working with students who are started to get engaged after they take their PSAT in the fall of junior year, that's a common timeframe that a lot of students tend to start to kick in the whole process here, or at least started thinking about college. And the great thing about that is it gives them a good six to eight months of really thoughtful research and opportunities to visit, gather their thoughts on why they're going to college in the first place. Because the heavy workload really does kick in at the same time senior year of high school starts, that's typically when the application season, the writing of college essays occurs, and more college visits that they didn't quite get to do as juniors. So that could be a busy busy time for folks.

Brad Baldridge
Right. But I always tell people is, there's a lot of deadlines in the senior year around when you can apply and financial aid and all that stuff. So the calendar, and the timeline is very much set by the colleges.

Todd Weaver
That is correct.

Brad Baldridge
The junior year, there really aren't a lot of deadlines, per se, but junior year and even sophomore year, is the time where parents can prepare for those first deadlines that are coming up in your senior year. So you've got all of sophomore and junior year to do things like college visits, and test did planning and test prep and figuring out the finances and all those types of things. But there's no deadline per se, nobody's gonna say, 'Well, are you on track? Have you done this, this should be done by here or there.' It's, you kind of have to self impose deadlines of trying to figure out the family budget, and what can we afford for college, if you

Todd Weaver
I would tend to agree with that.

Brad Baldridge
Right. And if you don't do it sophomore year or junior year, well, then you're gonna be doing all that stuff while you're trying to meet the college's deadlines. So you can spread it out, and it make your life a little simpler, as far as you'll get, I... Another analogy I use is we pay for college with time, with money, and with stress. And if we don't start early enough, then the stress goes up. And often the costs go up, because we didn't put the time in.

Todd Weaver
Right. That's something I would agree with.

Brad Baldridge
So let's get into some practical tips. We need to start early. So, what does that mean? As far as I am the parent of a junior right now, and we happen to be in the fall. So I'm looking ahead to the entire junior year, I've got fall and spring to work with, what types of things should we be doing? Or what can we do to make things better?

Todd Weaver
Well, I think one of the great things to try to do, and I know we're all short on time, because our families are typically extremely busy with a lot of activities. And sometimes it's difficult to get the teen in the house to want to hang around mom and dad at this stage in their life. But, if you can, the best thing to start doing I think in the fall of junior year is go walk around some campuses, go visit a couple of schools. There's not a lot of pressure at this timeframe for the students, and gives them a chance to just start to get their head in the right place and think about the concept of going to college.

Brad Baldridge
Right

Todd Weaver
I think that can be a really good opportunity just to get the mindset going for the student and get them talking about their thinking about college.

Brad Baldridge
Right, and what I like about the early visit is you can do it local, if you want. And I typically encourage that as go to colleges that are near you that might be on the list. And if there isn't anything near you on the list, then go to a college that, you know you're not going to go to just to practice.

Todd Weaver
That's a great idea.

Brad Baldridge
Just to get your feet wet. And again, a lot of parents have gone to college. So they have a pretty good understanding of what it's all about. I would say that typical 17 year old, their experience with colleges, whatever they've seen on the various shows that they may have watched that is based on a college or god forbid, something like Animal House. But the challenge I think for a lot of young kids is they're trying to figure out what college really means and so they just get out there and start with a frame of reference. I think it helps them if they start doing video tours and other things where they can say, 'Oh, this campus looks a lot like that campus that I was on.' So I don't think videos in lot of cases are bad, but they're not like being there. Especially if you don't have a frame of reference.

Todd Weaver
Right.

Brad Baldridge
Alright, so we can get out there and start doing our visits. I guess the other thing would be starting to think about the money. So when we say that, what kind of things can we be doing?

Todd Weaver
Well, that's a great question. I think for a lot of families, particularly at the time we're recording this, we're 18-19 months into the pandemic times, and I think many families had some financial challenges over the past year, year and a half. And if you happen to have a high school scene you're and you're listening to this podcast, you're, you're thinking about the money. And this might be a time to figure out how do I tell the schools that my 2020 taxes which I have to show them, for my student end up to college in 2022, are not reflective of what the financial or tax year 2021 was really like? We had a job loss or had to change something up, or there was some conflicts that led to changes in income and assets. And these are conversations parents could certainly be having even parents or juniors, with the financial aid officers, just to get a feel for what's the potential need-based or merit-based aid might look like for their student. It's challenging at this time of the year, though, nobody's going to give you a guarantee of anything from the college side. But the financial aid officers are there to help. And they're the people that when your student goes to visit a campus, it'd be let the student walk around for an hour by themselves while you go in with your tax returns and talk to the financial aid officer and say, 'Hey, can you give me an early read on this? What's it going to look like?'

Brad Baldridge
Right? Absolutely, I think and what we're we're driving at here is that the way financial aid works, it looks back in your history quite a ways now. It used to be prior year, now they have this concept called prior prior year, which makes it much easier to do the paperwork. But unfortunately, though, you're also making the tax return a year and a half old by the time you're using it. And so the challenge there as well, this tax return doesn't really match my life anymore. And that's not new to colleges, they, for years and years, they've been adjusting things based on new circumstances. So you just need to talk with the college and work with financial aid. And they can often make adjustments on your applications based on the new reality. But then they'll typically going to ask for some documentation and some verification and what the new reality is, whether it's a change in pay because of a job or of business closure or a divorce, or there's lots of things that can happen and in that interim year, or year and a half or between when the taxes were created, and when you actually go off to school.

Todd Weaver
And I think another thing, Brad, is a lot of families assume that they may not be eligible for financial aid or assistance.

Brad Baldridge
Yes.

Todd Weaver
And I think that's a real problem because families may not realize how many more expensive sticker price colleges might actually have a lot of money to hand out for families with moderate to middle income, and even some higher income levels. Until they actually run the numbers, I think that's one of the most essential things parents could be doing is discover whether or not you will qualify for anything before your student has created a list or at least before you start traveling all over the place visiting these schools, that may end up being unaffordable

Brad Baldridge
Right

Todd Weaver
I think it's helpful to understand what is your own state school cost? Are you at a stage in your life with a high school junior, senior where it makes sense to save more in a five to nine college savings account or another vehicle, or continue plugging along as you have been? These are all the big picture questions on the finance side that many families should have some conversations with their student, with their CPA with their financial advisor, with a college financial advisor, financial aid officers at some of these schools. There's so many people out there able and willing to help. All you need to do is reach out and schedule some sessions with these folks to start to get a feel for what the actual numbers are going to look like. I think too often families that I work with, wait far too long in this process to get that conversation going.

Brad Baldridge
Right? Yeah, I mean, that's one of the first things that both in my course, and when I work with families directly, one of the first things you need to figure out is, what is the price of your local state school, that's often the price that is kind of a guaranteed known price. Now, it's not free, it's often 10, 15, 20, 25,000 net cost for a family, depending on your state and that type of thing. But again, all of the other competing colleges know that you have that option. I mean, it's not a secret. In your neck of the woods, Boston University knows what you U of Massachusetts costs. And they know if they're going to be competing with that type of school, they know where they're going to be and they know where they need to get. So, I mean, I think families just need to be aware, in general, many of the private schools know that, let's say the state school, is 25,000. So, state school 25,000, private schools 75,000, that's a tough sell.

Todd Weaver
And they know it, right.

Brad Baldridge
And they don't even try in some, most of the time. So what they do is they offer some form of merit aid or need based aid, or scholarships or other ways to reduce the cost. So now it might be your state school is 25. And this private school over here is also 25. Or maybe it's 35. Or maybe it's 45, again, depending on your particular situation. And then, of course, a fantastic situation is your local state school's 25. And the private schools, you like are 15, which happens, but that's certainly not a sure thing. But that's what we're talking about here, is you really need to get out there and understand what those prices are, or at least what the possibilities are. And unfortunately, a little bit convoluted and complicated as far as how need-based aid and merit-based aid works. And it's either you figure it out, and how it applies to your family, or you don't. Now, I don't know how often I've heard something like this of, 'We're not going to qualify for a because my brother-in-law didn't qualify for aid.'

Todd Weaver
Right.

Brad Baldridge
Like, oh, well, a.) did your brother-in-law do it right? b.) are you just like your brother-in-law? I mean

Todd Weaver
Right

Brad Baldridge
You need, in order for that to be a valid comparison, you have to understand that you need to be going to similar schools, with students with similar academics, and similar financial profiles. And most of the time, it's not an apples to apples comparison. So it's not as valid. So you really need to figure it out for yourself.

Todd Weaver
I think that's a great point that people need to realize every family is different, every situation is different, the colleges will treat a family that happens to have a lot of consumer debt, perhaps a little differently than a family that doesn't, even though they may have the same house, live on the same street, same type of cars, same salaries, those two families may be looked at, in a very different way by a college that both households might be having students apply to. I think you're absolutely right, each family has to look at this without the influence of peers and brother-in-law and cousins and other people telling them, 'Oh, you'll never get anything.' Well, you they don't know that.

Brad Baldridge
Right.

Todd Weaver
You need to verify it by actually looking at your numbers and what the colleges are going to offer your student.

Brad Baldridge
Right. And now some of the colleges, and may not some, all of the colleges are required to have a net price calculator on their website, which theoretically, if you put all your information into them will tell you an estimate of what colleges may cost. The challenge, I think is some colleges take the net price calculator seriously, and they do a good job. But occasionally, especially a state school, where they don't have a lot of resources, you'll go to a net price calculator. And it'll be obviously out of date, it'll ask things like, 'Well, what was your income in 2014?

Todd Weaver
Right?

Brad Baldridge
It's like, okay, obviously, 2014, is that relevant? They should be asking what was your income, and if you have a 2020 student or a 2022 student, they should be asking about 2020 income, not 2014. That's a signal that they haven't worked on that calculator for at least six years.

Todd Weaver
That's true.

Brad Baldridge
So that one maybe not so reliable anymore. So it is a tool you need to be aware of. You can also, at my website, we have an EFC calculator that helps you figure out need based aid. So yeah, there's a lot of different challenges around understanding the price. Now, ideally, we'd love to hear from families in the junior year, even the sophomore year. Again, I've had to tell people I've never ever had anyone tell me they started this too early.

Todd Weaver
Right?

Brad Baldridge
Not once. I'd have had hundreds of people tell me they started too late. And so what does that mean? Well, get to work your junior year, if you can, at all, and even consider sophomore year. And again, sometimes your student's not mature enough to do visits or that type of thing. But there's things that parents can do that students aren't involved with, like figuring out if you're gonna qualify for aid or that type of thing. Generally, that's parents doing it your students not involved so you can do it whether your students ready or not.

Todd Weaver
Right.

Brad Baldridge
Well, let's turn the tight now there's probably a number of people listening right now that are saying, 'Oh, yes, but I understand what you're saying. But it's already too late for me. I already have a senior. Now what? What are some things that people that feel like they're behind the game can do to catch up or, you know, if someone came to you as a senior would you work with them still or what happens there?

Todd Weaver
Yeah. Ironically, we've had several families with seniors come in, in the past month or two saying we are feeling very overwhelmed and lost in the cycle or high school guidance, we thought was going to be perhaps a little more helpful. But unfortunately, they've been busy with other things like getting students back in school, from a pandemic. And the sense I've received from a lot of families is their students are still coming out of that fog, of being in and out of school last year remote learning things of that nature, and colleges not even being open to go physically visit. And that's now coming back into play here, this opportunity. So I, I do understand where the current crop of seniors is coming from, they've just had a real challenge. The past year, obviously do the quote unquote, 'traditional college search.' But for seniors coming to the table at this stage, I think you have to talk to the parties here, the student and the parents in a way that says, look, let's, let's choose our battles, because we're in a situation now where if you did the full, deep dive on the college search, to get the right amount of education, you need to make a good decision here, this could be similar to drinking from a firehose, there's a lot to do. And it can be done, it's just going to take a lot of effort from both a college coach, if you were to work with one independently here, or students working on their own, or with their guidance counselor, they've got a lot of work to put together. And I think you and I've talked about this before, I think it's, it's important to say, 'Okay, so let's cut to the chase here. We have to put a state school or two on the list for financial and potentially academic likelihood.' And then make sure if you're looking at other schools, they're appropriate choices, we don't have time to research 30, 40, 50 schools like you might have had, if he started as a junior, it's now a much narrower list and focused on getting an appropriate option together for a student. And the nice thing is, we're having this conversation in October-November timeframe, a lot of early deadlines come up very soon, but colleges also have a lot of regular deadlines that are after the first of the year. So there still are plenty of opportunities to put together a good college shirt and application plan that's going to work for your student. So it's not the end of the world, but you're getting pretty close to the edge.

Brad Baldridge
Right? Exactly. I think both you and I, when we start working with someone that where we're starting really late, one of the things we try and do is essentially some damage control in that. Alright, where are you so far, and oh, this is my school list, and we'll very quickly try and estimate guestimate the schools on the list? Because I've had people come to me at the end of the senior year with this problem, they say something like, 'Well, we applied to these seven schools, the first five we weren't, we're not even accepted at, this one we were wait listed at, and the one that's left is really, really expensive. What can we do?' It's like, well, if you're at the end of the senior year, what you can do is find a school that takes a really late application, which often is not the types of schools that some families are interested in, you can write the big check and just take it on the chin, so to speak, and then maybe transfer the next year, or you can take a gap year of some sort and delay college for a year, though, you're really have kind of painted yourself in a corner. So that's kind of the first the first things that you and I would do is, 'Okay, are we, is that what we're doing here? By basing on the school list, are we, do we have any schools that while we call maybe a financial safety school, a school where we know the price will be palatable, especially if price is important.' And again, if you know if the parent is saying any school, any price, we don't care, which is rare, but still happens occasionally, then that's not the battle we're struggling with then. And then we're battling with some other struggles. So what types of things would families need to do as quick as possible once we get going in the senior year?

Todd Weaver
Well, I think one of the first questions to ask is, is your student mindset around this appropriately? I think like you said earlier in this conversation, if you haven't been to a lot of places yet, get out and do a local visit, just get somewhere, get on campus and get your student thinking about what colleges. It could be a city, rural, suburban, 20,000 students, 2000 students doesn't really matter at this stage. But just get out there and take a look at something. Get the conversation going.

Brad Baldridge
Right, right. And you're looking for a way to eliminate a swath of schools potentially.

Todd Weaver
Right

Brad Baldridge
Because there are thousands of schools. You'd love for the student to say, 'I don't like it in the big cities,' or 'I love it in the big cities,' because all of a sudden now, that cuts the list in half instantly, it's like, roughly half the schools are in big cities, and the other half aren't. So if you knew that, or if they would say, 'I want a big school or a small school,' or 'I need a school that has this unique major,' or whatever, it might be just some ways to start narrowing the list, assuming you're still trying to build the list. What about the financial side of things?

Todd Weaver
I think, for financial, I think a lot of people get really nervous when they hear that the forums open on October 1, and they're getting all of these emails and comments to hurry up and file, hurry up and file. And October 1, to remind everyone is not a deadline, it's simply when the forums open. And I think there's a lot of noise out there that scares people to file things before they take a thorough look at their numbers and realize, 'Oops, I should have paid down my credit card debt with some of my cash to give me less of an asset to be considered in the financial aid cycle here.' Or, 'Maybe I could talk to my boss about a year end bonus that I usually get December, see if they can push it out to January next year, don't have to report it this year.' Little things like that, that may or may not be part of a flexible option for a family can help.

Brad Baldridge
Right.

Todd Weaver
But the other thing, it's a typical mistake when they rush it.

Brad Baldridge
Sure. And another quick tip on that regard of is the amount of money that a student has, ideally is zero. And, again, most of the time, it's relatively true to begin with. Most students, maybe they've had some summer work or something, if they have a bank account, with 3000, 5000, 10,000, they give that to Mom and Dad, and that their bank accounts are zero and then mom and dad can save it for college. And then of course, if now the student feels broke, and mom didn't give some, mom or dad gave some of that money back if the students saying, 'I need to pay for a prom, and you have all my money.' Ideally, right? You say, 'Well, yeah, we owe you that 10,000. So here's a couple $100 to go buy your prom stuff.'

Todd Weaver
Right.

Brad Baldridge
But ideally, again, we don't want big dollars in the student's name. And again, as far as need based aid is concerned. Now some families, they can ask where we, kind of the crash course, if you're not going to get need-based aid, then it doesn't really matter what you do. But you'd have to understand, will I get need based aid? And if I do, how can I make it better? is one of the things that you work through pretty quickly, where you can.

Todd Weaver
Absolutely, the more advanced work you can do, the better comfort level you're going to have when it comes time to actually file forms and start getting a discussion going on the financial aid offering in the new year.

Brad Baldridge
Right? Yeah, so let's change gears one more time and talk a little bit about college testing. Because I think that you get I don't know if we have any solid tips here because it's really is up in the air. But kind of the backstory, of course is COVID came along and made testing difficult for many of the students. Mostly the students that are off to college right now, they really had a challenge around getting their testing done. And a lot of the colleges realized that if they required a test, and they weren't flexible on that, half the students just couldn't get it done or more. And therefore they were limiting their customers. And colleges are a business. So they said, 'Well, I guess we're gonna have to do something about the testing problem.' And a vast majority of the colleges waive testing for their incoming class. Some of them said we're gonna waive it for students starting in 2021. Some of them said, 'We're gonna waive it for 2021 and 2022.' Many of them didn't make it real clear. But now if we've got a junior right now, they're looking to start in 2023. So that's I guess, a challenge, right? We need to build the test plan in our junior year. And it's not clear whether colleges are going to require it or not many of most colleges aren't talking much about what's going to happen in 2023, that I'm aware of. What have you seen?

Todd Weaver
I would say that I'm hearing the same thing. I believe they're focused on '22. And not really looking ahead yet at the new year. But I think a lot of what I see and hear is colleges that decided to provide test optional offerings, at the beginning of the pandemic, have said we're going to do this on a two or three-year trial. So in 2023, we'll reassess things or in 2022, we'll reassess things, but I think it's over 75% now. Four-year colleges do not require test scores to be sent in. It depends on where your student is looking. If you're in California and you're planning on applying to the UC System, they've actually been mandated by law to become test blind, they're not allowed to look at test scores even if you send them in. So that's a school system, largest in the country that hasn't considered test scores, and hopefully never will, again, for the SAT, or maybe the ACT as well. In my understanding, California is going to try to build their own test. Different side of the coin, if you're applying to school in Florida, or Georgia, those two states have systems with their, their state, their higher ed department and some of their scholarship programs that require test scores and the rules. So they, Florida, I don't believe ever got rid of test scores at the state level last year, they certainly didn't, for this coming year and '22. And Georgia did do test optional at the last minute, last year. And this, this current batch of seniors applying to schools in Georgia are back on the clock for testing. So different types of schools, public private, I think it's important for families and students to research the admission requirements on each and every webpage of the schools that their student is considering before they decide whether or not they need to test. If you have a senior now and you haven't tested yet, you're getting to the stage where it's going to be pretty difficult to get a test score in time to apply. There are a couple more national test dates coming up in October and November, which would lead someone to think, 'Well, if you apply regular decision in January at a school, you might be able to set a test score in for that.' But I think for the juniors, class of 2023, they should probably think about how testing may affect their admission process a year from now, and give some consideration to reaching out to the colleges, college websites, at least on the admission pages and saying, 'Hey, what's your test optional policy for the class of 2023? Because I might need to take a test in the spring of '22 in order to be considered for admission.'

Brad Baldridge
Right. Exactly. And I think that's the challenge in that college is, and not just colleges, the whole world, has been very short sighted. Because COVID keeps changing and the rules keep changing. And I think in general, the colleges are struggling with what are the rules going to be for the next few weeks, and they're not able to really think ahead to what are the rules going to be a two years from now. Unfortunately, that does have an impact, where again, juniors right now are saying, 'Should I be test and test prep and doing those types of things or not? Can I rely on test optional?' My gut reaction is I think you should assume you're going to test. And especially if your student has strong test taking abilities already. I mean, you already know that my student tends to excel at the standardized tests, when they took one at the end eighth grade, they did well, when they took, you've got that kid, you probably were going to want to test if you can, in case you need it might be appropriate. And if you're on the other end of that spectrum, if you have someone that just fears and hates test, well, I think you're going to have an uphill battle because the student is going to say things like, 'Well, it's test optional. Now I don't have to go through this pain and agony.'

Todd Weaver
Right.

Brad Baldridge
And that may be true. But I don't know about it entirely. So I would recommend that you talk early and often with the colleges you're considering. And I think there's two questions you need to ask. One is what is your test policy for admission? And what is your test policy for scholarships, and state aid and other things? So that would give this college the opportunity to say, 'Well, we can admit you without tests, but you live in Florida, and we're in Florida, the state programs still require test. So we can't award your state aid, because you don't have a test score?' Oh, that's good to know

Todd Weaver
Right.

Brad Baldridge
And it's going to be an ongoing moving target. So not only ask now, ask while you're visiting, ask again, when you apply, again, because I think it's a moving target. And you may not get solid answers early on, because again, they're just saying, 'Well, 'we haven't devised our plan yet for 2023. We're working on that.'

Todd Weaver
Right

Brad Baldridge
Okay, well, what do I do with that bit of information?

Todd Weaver
I think, worst case scenario, if you don't get an opportunity to take a test, there are hundreds, if not a thousand or so, colleges out there that are test optional and have been for many, many years. So for students who are looking at those schools, there could be less stress, and going back to what you said earlier, for meeting with high school seniors who are just getting started in this process. It makes a lot of sense to start building a list with colleges you know are tests optional, because that alleviates one more stress point that you don't have to deal with if you can talk to those students who are just getting started here and say, 'Look, there's some schools you just probably shouldn't apply to, and but there are plenty of other great options to look at. And here they are.' And that can really help streamline some of the challenges that students who are just now starting this processes high school seniors might be facing.

Brad Baldridge
Right? Absolutely. Alright, so let's wrap things up. But I think the moral of the story is, jump in, get to work, it's not going to go away, and procastination's not gonna make it any better. But so, broadly speaking, we can also find things that will help us with, you know, here's an obvious one. You maybe should listen to a good podcast about college planning. If you can find one, I recommend mine.

Todd Weaver
Absolutely. I do too.

Brad Baldridge
Maybe that's a little self serving, but we could also

Todd Weaver
Not sure.

Brad Baldridge
Right? Hire someone to help. You and I work with families, many others work with families in various aspects, who can come in and do triage and and help us out. What else might we do? You have some things available on your website, I believe we'll talk about that.

Todd Weaver
Sure. So our website is strategiesforcollegecom. And we have a really great free learning center that we've set up there that includes several videos and just give students and parents a strong overview on how to get started and perhaps what it might look like for them. We also have a couple of book recommendations. And one of our colleagues, Beth Walker has written Never Pay Retail for College, a few years old, but still rings very true today. And it's great information on right school at the right price. But I think that's a great way to get started. I, I agree with you that I think you want to, as a parent, reach out to a few different people that you know are experts in the field and just get some advice on where to begin if you're just starting out with a senior but if you have a junior, you've got a little more time to be more thoughtful on how to plan this all out and and help your students get educated so they can make a great choice on a game.

Brad Baldridge
Right. Absolutely. And I think that's, a lot of people don't realize is there's, again, there are many ways to deal with college planning. You can learn it yourself and do it, you can hire someone else to help you with it, you can find something down the middle, perhaps where you do a little of both. But I think a lot of families, once they realize what they're up against, if they know that we exist, and they... And we can help. I think that's the challenge is most families don't know who who could help with these problems. And what kind of services are available out there, where when your pipes are leaking in your basement is flooding, you know who to call. But when you're struggling with college, sometimes you might call the high school or the colleges themselves, but there are other opportunities out there. And that's why we're putting things out on a podcast and that kind of stuff is we just want to get the word out there. There's lots of ways to deal with this problem, then every year, this problem gets a little more complex. Alright, well, then we're gonna wrap it up here. Again, if all the information that we just talked about, will have links to Todd's website and the learning center and that type of thing in the show notes. So tamingthehighcostofcollege/133 for this episode, and we can get all that information. I appreciate your insights here today, Todd, and we will talk again soon, I'm sure.

Todd Weaver
Thank you, Brad. It's great chatting with you.

Brad Baldridge
All right, that was a great interview with Todd. Obviously, we have a lot that we can talk about when it comes to paying for college. If you have any specific questions or you feel like you didn't quite get the answers that you need, please visit our websites or go ahead and give us a call or reach out to us however you'd like. We're here to help. And we'll see you next week.

Presenter
Thank you for listening to the Taming the High Cost of College Podcast. Now it's time for you to take action head to tamingthehighcostofcollege.com for show notes, bonus content, and to leave feedback for Brad. The next step on your college journey starts now.

Brad Baldridge is a registered representative of Cambridge Investment Research and an investment advisor representative of Cambridge Investment Research Advisors, our registered investment advisor. Securities are offered through Cambridge Investment Research Incorporated, a broker dealer and member of FINRA and SIPC. Brad owns two companies: Baldridge Wealth Management and Baldridge College Solutions. The Baldrige companies are not affiliated with Cambridge Investment Research.

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THCC Episode 119 – How to Make College Planning Easier by Working with Consultants

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Today’s Guest:

Chuck Erickson, Independent Educational Consultant from College Connectors

According to Chuck, independent educational consultants are “professionals that have experience and knowledge about the college admissions and application process, but are not directly connected to a specific high school or college.”

As an independent educational consultant at College Connectors, Chuck has worked within higher education for 15 years, assisting students and families with the college application process. He has lots of information and tips to help you get started, so listen to this episode if you’d like your college planning to be easy and seamless!

Questions Answered Today:

How much time do I need for the application process?

You may think there’s plenty of time, but most students and parents quickly discover that there is very little time for the whole college application process, which takes about 16 months. The entire process competes with exams, projects, deadlines, and everything senior students need to accomplish before graduation. You need to move quickly and stay on top of all deadlines. Otherwise, the next thing you know, your son or daughter will lose his or her chance to enroll in his/her preferred college or university.

It’s also important that parents realize you can separate what parents need to do and what students need to do with college planning. Parents can do some of the things whether their student is ready or not.

Brad Baldridge

Why do I need independent educational consultants?

When planning for college, it’s a must that you and your son/daughter work hand-in-hand with high school counselors and preferably with independent educational consultants. Chuck, an independent educational consultant (IEC), elaborated the differences between a consultant and a high school counselor and why you should opt for an IEC to guide your child one-on-one.

High school counselors are readily available at school, but their time availability is limited to an hour per student, and the ratio of one counselor per 100 students doesn’t seem like they can give intensive focus to your child. Counselors can be relied on for the following services:

  • Sending students’ transcripts to colleges
  • Navigating letters of recommendation
  • Sending the high school’s profile to the college
  • Other similar services

Independent educational consultants, on the other hand, are not affiliated with any high school and typically have much more time available to help your student. They don’t have access to the school documents that high school counselors handle, but you can count on them for:

  • Helping you get started on college planning at the time of your convenience
  • Introducing your student to hundreds of colleges they know very well
  • Assisting your student with the entire application process
  • Assessing your student’s preferred academic and social environment, among other things

I always want to find out: what are the goals of the students and what are the goals of the parents?

Chuck Erickson

Knowing the right people to work with takes some load off your shoulders!

Who else should I work closely with?

You can also work with college financial planners such as our host, Brad. Brad says that you can opt for early-stage college financial planning for newborn or two year-olds, or for late-stage planning for high schoolers as early as their freshman year.

He gauges the parents’ readiness for college costs and asks questions such as:

  • Are you considering state public schools or private schools?
  • Are you willing to co-sign a loan in case an issue with getting a student loan comes up?
  • If you have multiple children, how do you plan to divide the costs?

Ultimately, the earlier you ask for help from experts like Brad, the more financially ready you become.

The reality is most people don’t have all the money they’re ever going to need for college. It’s still a work in progress, so we’re trying to figure out how to use your money efficiently.

Brad Baldridge

It’s your hard-earned money. Protect it by spending it wisely!

Why should I plan early?

In case you missed it, the college application and recruitment process takes about 16 months. Tedious essays, several recommendation letters, application forms, and financial aid forms are just some of the requirements they ask for, and there are nearly 3,000 college opportunities in the United States alone.

Sounds tight? Here’s another thing you might not know: colleges are big on deadlines.

Both Brad and Chuck agree that when it comes to preparing for college, you can be late and miss a lot of opportunities for your student, but you can never be “too early.” Which route would you want to take?

My biggest caution around the timeline is: I’ve never ever had anyone tell me, ‘We started this too early.’ I’ve had a whole lot of people tell me, ‘We started this too late.’

Brad Baldridge

Ask for the help of the experts as soon as possible, so your student can get the best advice and start planning early.

What do I lose by not planning early?

You should start college planning way before getting your student’s SAT scores, GPA, and school rankings. Why so early? Here’s a scenario from Chuck:

Your son wants to take Engineering in college. However, for him to get in, he needs to take Calculus as a prerequisite. If you’re unaware of this, your son may have to double up on math, at the last minute, just to catch up.

This can go differently if you start planning as early as the freshman and sophomore year. There are a lot of things to consider when planning: the student’s testing skills, interests, preferences, and more. Just remember that planning doesn’t have to be hectic. Reach out to consultations early, and help yourself by getting your student into college as smoothly as possible.

What else should I know as a parent?

Trust the experts when they tell you to start college planning as early as possible. You may not realize this, but as a parent, in your own simple ways, you can give your student a glimpse of what it actually feels like to be in college. It doesn’t have to take too much of your time. Here are some recommendations:

  • On your day off, make quick and informal visits to local flagship state schools or local private schools.
  • If you’re visiting a relative or a friend, take time to visit some nearby colleges.

Making campus visits allows you and your student to see how colleges operate, which can help a lot in the selection process.

Most importantly, make sure that your student’s options are not limited, so when the time comes, your student and family can make a decision that benefits everyone in the long run.

Links and Resources

Helpful Resources

Brad’s Recommends:

Visit our website Taming The High Cost of College for additional helpful resources. Here are the most important ones parents would find helpful:

The College Planning Jumpstart is a complete video course that teaches you everything you need to know about how to plan and pay for college, how to maximize financial aid, how to prepare for testing, apply for scholarships, get low-cost student loans, and choose the right school.

The Expected Family Contribution (EFC) Calculator asks for your income and assets to determine your financial eligibility to contribute to college costs.

Net Costs of College by State are also available, showing you how much one year of college at specific schools will potentially cost your family, based on your income. You can view the average net costs by income bracket for colleges in all 50 U.S. states. Net cost is the total cost of attendance for one year, minus government grants and institutional scholarships, and my website shows the latest available data from the U.S. Department of Education.

Sign up for my free e-newsletter that’s loaded with college planning tips, advice and secrets that will help you save time, save stress and save money.

The Scholarship Guide for Busy Parents is a free video series that will help you understand need-based and merit-based scholarships, what opportunities there might be for your student, and whether to apply.

The Taming the High Cost of College Podcast features well over 100 episodes of college planning tips, advice and interviews with leading experts on an array of important topics. Check out our complete list of episodes and make sure to read the show notes to find out which ones are most relevant to you.

THANKS FOR JOINING US!

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The bottom line is that we care what you think and want to help you out, so we’d appreciate you reviewing us on Apple Podcasts, Spotify or your preferred podcast platform. Even better, to receive automatic updates, please subscribe to Taming the High Cost of College on Apple Podcasts, Spotify, or wherever you listen to your favorite shows.

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Brad Baldridge
Welcome to Taming the High Cost of College. This is Episode 119. In this episode, Chuck and I are going to talk about college planning at the highest level and introduce you to the many areas that go into a good college plan. So if you're the parent of a high school student, and you're working on college, or even just starting to think about college, you're in the right place.

Presenter
You have kids, they grow up. And before you know it, it's time to plan for college. Where do you start? How much is it going to cost? you qualify for financial aid? Should you be looking into scholarships? Will you be able to retire? What about student loans? The list of questions is never-ending. The good news is all the answers are right here. Welcome to the Taming the High Cost of College Podcast here is your host Certified Financial Planner, Brad Baldridge.

Brad Baldridge
All right, welcome back to Taming the High Cost of College. I'm your host, Brad Baldridge, you've been following us for a while, you'll notice that the podcast took a very long hiatus. But we are back, we are going to start creating more podcast episodes. So stay tuned. Matter of fact, I'm working with Chuck into build about 11 episodes. So we have this intro episode where we talk about the overall college planning and some very general terms around college planning. And then we have 10 more episodes where we're gonna dive a little deeper into 10 different topics. So this should be a great series debt for most families to understand how college planning works, and maybe get the basics in many different areas as a great way to jumpstart your college planning. As always, we have show notes available and shownotes have all the links and additional information so that if you're driving or exercising, you can just go to the website at taming the high cost of college.com slash 119, which stands for Episode 119. You go to the show notes. Again, you'll have all the links and all the various information that we discussed in this. So you don't have to try and write things down while you're listening. You can always just go to the website and download information. Or sometimes there'll be links and other resources right there on that page. Alright, without any further ado, let's go ahead and jump into the first podcast in a long time where we have a discussion about the introduction to podcasting with Chuck. Here we go. Hi, and welcome to taming the high cost of college. We're gonna be doing things a little differently for the next 10 or 11 episodes. So I invited Chuck to be my co-host. So welcome, Chuck.

Chuck Erickson
Hey, Brad, thanks for inviting me.

Brad Baldridge
Yes, so Chuck is committed to helping me out on the next, as I said 10 or 11 episodes, and we're going to talk about a number of different college planning topics. And this is going to be relaunching the podcast. So if you go back and look, you'll see that we've got some some gaps in our episodes where we have had a couple of years off, but we're back, we're strong. And we're going to be posting these next 11 episodes in a timely fashion and taking it from there. So jack is going to help me and Jackson expert. He's an independent education consultant. So let's take a minute and talk with jack and learn a little bit more about what he does and how he does it. So jack, tell me a little bit about your business and how you help families.

Chuck Erickson
Right. So as you mentioned, I'm an Independent Educational Consultant with College Connectors. We are a small private educational firm that helps students and families navigate the college search and the application process. Before this, I've been doing this now for about seven years. And before this, I actually worked in college admissions for nearly 15 years, I worked in both public and private institutions. And I've spent my entire life really working with teenagers and helping them navigate the admissions scholarship and financial aid process from inside the university world. Now I'm on the outside of the university world and helping families this way. Right.

Brad Baldridge
So you typically work with high school kids then?

Chuck Erickson
Yeah, most of my clients are high schoolers. And obviously I'm hired by their parents, but most of my clients are high schoolers, typically sophomores, juniors, or seniors, although I started as early as eighth grade for some for certain types of students.

Brad Baldridge
Right. Okay. And obviously I do something very similar in that I work with high school families as well. But I come from the financial planning world and I focus primarily on what the parents are doing around saving and investing and figuring out financial aid and all that type. The thing, and you and I actually worked with the same families often because you tend to do with all the things I don't know much about. So what do you say the difference between what you do and what I do is?

Chuck Erickson
Well, most of my time is actually spent with the student, I have a couple meetings with the parents. But most of my time is spent with the student, I'm helping them understand themselves, helping them figure out what types of colleges might fit them best. And then once we figure out where they would like to apply, helping them figure out and fill in all of their applications, essays, letters of recommendation, all of those pieces. So I always tell families, there are two things that I do not work on. Number one is I am not a test prep person. So I don't help with test preparation, although I can give you advice as to how to, to figure out the tests. And that's in a later episode. And then number two is I don't do anything fiduciary financial. So that is when I send them over to you, Brad.

Brad Baldridge
Absolutely. And I'm just the opposite. I tend to work with parents and almost never with students. So I occasionally will meet the students I'm working with, and maybe we'll have one meeting. But I would say that maybe half the time, the other half of the time I'm working exclusively with the parents, and coaching them. And occasionally we'll, I'll help the student through the parent, I'll give the parent some ideas on what they might do to solve a problem. And oftentimes, it might be, you find someone like Chuck that can really get into it with the students. Because, again, I always make a joke, you do not want me looking at an essay, you do not want me trying to figure out what your student should be when they grow up. It's just not my area of expertise, I make things worse, probably than better. So to check in I work can work well together when needed. Alright, let's jump into college planning. So Jackie, and I both help families do their college planning. And obviously, we just come from two different angles. But so let's talk about what is college planning for you check what is what does that typically mean? When you're working with families?

Chuck Erickson
When I'm working with families, I'm really trying to help students figure out what type of experience they want for college. So are they looking for two year four year public private, near to home far away, really helping them plan also, I work with course selection in high school and help them figuring out their activities. So really, it's all of the pieces of figuring out what do I want in my post high school experience. So I've even helped students figure out gap year programmes and even enrolling in the military as well. So I'm really focused on the student and helping them get on track to make sure that they meet all of the deadlines that happened during the college search and application process.

Brad Baldridge
Right. And I look at college planning from a, again, parent and family perspective, and what are all the tasks that need to get done? and saving and investing? And how are we going to pay for college? And how do we make it perhaps more affordable? And what kind of impact will spending X on college have on retirement or other financial goals? Many times we have those tough discussions about well, is this college worth it? This one's 10,000 more than that one is that worth 10,000 more, or 20 or 30, or whatever the differences might be, and how much can a family afford and all the different pieces around that. So again, and it's a big undertaking for for most families, again, because they're either two different pieces. So let's talk a little bit about what's coming up as far as podcasts. So again, we've got 10 podcasts coming up the titles, finding a good fit school, figuring out the net price of schools, choosing a major and career, how to do college research and college visits, what it takes to get accepted at certain schools, scholarships, and and their multiple forms, loans, college testing, and then finally need based aid. So we're going to cover a wide gamut of college planning. And that's great. There is a good intro the to understand that college planning is very broad, and that all those topics are all under the umbrella of college planning. So what is your thoughts as far as when a family should start all this?

Chuck Erickson
I wish I had $1 for every family that told me Oh, I wish we would have started with you sooner. So basically, there's this old myth of while we don't start thinking about college until my kid is a rising senior and in my world and what's going on with the application process and the essay process at colleges, that's almost too late. So you really need to start earlier, most students start with me at the end of their sophomore year or the very beginning of their junior year. But really, when a student starts worrying about college and asking about college, then that's the time to seek me out so I can help and make this pathway a little bit smoother.

Brad Baldridge
Absolutely. And I would say something similar in that. We definitely need to start thinking about the financial side of college. And again, we can start with that with even young kids. Just this transition where we switch over from what I would call early stage to late stage, so early stages, we think we have students that are ultimately going to go to college. That's one of our goals. And maybe you start saving and investing and building some college fund in order to have some money for college. And that's about all you can do. It's really hard to pick majors are talking about what school is appropriate for your four year old. But then we move into what I would call late stage planning, which again, is where we start doing all the heavy lifting, junior senior year for sure. But both Chuck and I feel like we would if we could really push into the sophomore year with some of this, it would make everybody's life a lot easier. And again, there's not all students I think are mature enough to necessarily get out there and do hardcore, let's visit colleges and that stuff. But there's lots of other stuff you can get out of the way, while your student grows up if that's an issue. And as Chuck mentioned, sometimes the students already I mean, what what do you see as far as when students are ready to really dive into it?

Chuck Erickson
Yeah, I think I think the light bulb gets turned on once students start sitting down for those AC T's and those FA T's, which typically happens in the junior year for some kids, they'll take the PSAT earlier or, or the pre a CT. But when the tests start being talked about, that's when students go Mom, Dad, I think I need to think about college. But, as you said, there's stuff that I can be helping with earlier. So one critical part is course planning and figuring out what courses students should be taking in high school to prepare them for college level work. And sometimes students don't think about that, like what you take in freshman year determines what you take sophomore, junior and senior year in high school. And so I can also have those conversations, getting involved in school out of school and just starting the whole process, as you said, it might not be ready to go to a college visit. But maybe that could be a piece of puzzle as you're going on your family vacation. And we'll talk about that in a later episode.

Brad Baldridge
Right? Absolutely. So I think the biggest benefit of starting early is it prevents the the mad scramble, where there's a lot of stress. And

Chuck Erickson
Yeah, yeah.

Brad Baldridge
From a financial perspective, I think a lot of times, we get to the situation where we're essentially doing damage control instead of planning and laying it out and doing it the best way we can. We're now in this mode of, what do we have absolutely have to get done so that this doesn't totally blow up. And then a lot of times, we might cut out things like Well, we're not going to spend time on scholarships, because we just don't have the time. We didn't start early enough is what it really boils down to.

Chuck Erickson
Yeah, that's true with applications of a student has contacted me in the middle of their senior year about helping with their applications, I'm going to tell them that about 50% of the application deadlines have already passed, you've already missed most of the early application deadlines, if you're contacting me around Thanksgiving of your senior year. So then I'm also doing damage control and figuring out what colleges are still available and where they could possibly apply and trying to get all that ready and done in time. So yeah, the earlier, the better, less stress more organised and a better overall experience.

Brad Baldridge
Absolutely. So we've talked about this being a relatively large project, and it's going to take parents and students to coordinate and that type of thing. Chuck, and I tend to work with families where they need some help. So what are the options as far as doing your college planning? What did what areas have you seen and what makes sense for some families?

Chuck Erickson
Well, as far as some of them, many students don't actually need me. So if you're applying to your local public school, public institution, that is not that difficult to and, it's a one page application, you don't need me, but if students have other things going on, so if they want to be a varsity athlete and play division, 123, or NAIA sports, that's going to be another factor in the college search process, if they want to be in the Fine and Performing Arts, so music, dance, theatre, art, and fields that are related to those that is going to take an additional process, if the student is wanting to apply to a highly rejection institution. So a school that rejects borrow more than they admit, that's going to take some more work. And then last and certainly not least, and my favourite, if students have various learning challenges that might impact the process, so maybe it takes them longer to read or longer to write an essay, or they have accommodations that we need to consider as we're looking for colleges, which is many of my students. That group should also start earlier because there's more things going on. But yeah, if if you're just Johnny or Susie wanting to apply to the local four year public institution, you should probably be okay on your own unless you're very, very confused.

Brad Baldridge
Absolutely. But I think there's also a lot of families that are saying, 'Our goal is the local state school because that's all we can afford.' And the reality is, from the financial side, there's often ways that you can go to a private school, and again, not necessarily for free, or maybe not even the same as a state school, but at least cost competitive, maybe just a few 1000. More. So again, I think a lot of people, once they learn the process, they might realise that there's a lot more opportunity out there, versus just limiting it and saying, well, we're only going to consider the local state school, because that's all we can afford. And again, sometimes that's absolutely true, where in the end, that is going to be the most affordable option by far. And it's the best path. When sometimes, there's other paths that are available. And I think a lot of parents want to do the best they can for their kids. And sometimes the large, crowded local state schools not the right answer, sometimes the right answer is finding that specialty school that has something to offer that a lot of state schools don't offer, whether it's small class sizes, or particular majors or career paths or internships, or I mean, there's all kinds of reasons you would consider both your local state schools and schools across the country and private schools and all the other options.

Chuck Erickson
Yeah, absolutely. Over 50% of my students have gone to a school that they had not heard of prior to working with me. So that's the other fun part is, sometimes you don't know what you don't know. And by working with one of us, or both of us, we can help you understand things that you have not thought about or considered when you are thinking about this process, because the process has changed. This is not the same way of wise when you applied to college 2030 years ago, and it's much more complex, many more nuances that are happening going on things and factors to consider. So even just getting a consultation with us can help families understand, oh, we haven't thought about that, or Oh, we didn't think about this, and that can be helpful to them.

Brad Baldridge
Absolutely. And of course, we've got this whole podcast. So you can do it yourself. And, again, plug into things like the podcast and learn all the things that you need to do and that type of thing. And there's, I'm building some courses, and there's books out there, there's all kinds of information on my website, and Chuck's website, and many other websites. So there's all kinds of information. So I think you really have three options, you can do it yourself, you can do it yourself with help of some courses and books where you jump started. And then ultimately, if you need to, or want to, you could hire an expert, or even multiple experts. And again, sometimes you're looking for an expert around test prep, or the finances or helping your student, and it might be three different people that you might consider for different pieces of the puzzle. So I think, again, it's become a much bigger challenge, because the price of school, and the downside of not doing it well is much bigger deal if you end up changing schools or changing majors. And you need to tack on an extra semester or year to make up for something you didn't do quite right. That can be 10s of 1000s of dollars. And all of a sudden doing it right the first time makes a lot of sense.

Chuck Erickson
Right. And I'm wondering for you, Brad, are there certain types of families that you would want to work with earlier? So certain situations that they may want to consider starting with you maybe before senior year?

Brad Baldridge
Oh, for sure. Yeah. And again, for me, senior year is almost too late. I think everybody should be working on this and working at it hard by the middle of the junior year. And some, it would be great if they could start middle of sophomore year. And things that make things more complicated. When I'm working with families, there's multiple children, again, because maybe you can stretch and pay that big bill if you only have one kid, but that big bill times three kids or four kids, and all of a sudden it just the math doesn't work. So you really need to understand. And before you commit to spending all your money on the first kid, because again, sometimes then it's 'Well, sorry, Susie, we spent all the money on Johnny. So you're out of luck.' This doesn't fly in most families. So that's where we see disasters where now the family is feeling obligated to take on major loans or do things that they probably shouldn't have done and they know it in the back of their head. But because they helped one family or one student, they're going to help the others to an equal level, even at the detriment to their financial future.

Chuck Erickson
Uh-huh.

Brad Baldridge
Other areas where there's more complexity. And again, complexity means there's more opportunities to plan and there might be more opportunities to make things come out differently. But divorce in blended families is another complicated area when we start looking at need based aid and who's on the financial aid forms and who's going to pay and who's going to save, and who should have the investments in their name versus the other parent. Business owners and rental property owners are also have some additional work to do because of the financial aid forms. Some of them include the businesses and rental property, some of them don't, and how you value it is a challenge. But on top of that, having a business or rental property means you might have cash flow to help pay for college, as well. So that is just how do we do it efficiently? How do we get money out of the rental property or out of the business, and efficiently directed to college without getting hammered in taxes or other issues. So again, those types of things tend to make things more complicated. And there's more opportunities to save. And we also need to start much earlier if we can, again, most people don't know that we exist. So they don't know to look for us until they're well into the process sometimes. And we can do damage control at any point. But occasionally, we look back and say, 'You came to us as a senior, if you'd come to us as a sophomore, we could have fixed that, and that and that and that. And we didn't be in a much better position than where we are now.' But again, sometimes it's water over the bridge, we just have to pick up the pieces we have, and move forward.

Chuck Erickson
Yeah, yep. I've run into that as well.

Brad Baldridge
Exactly. So another thing to get our head around is how we might organise college planning. So we talked about the 10 different topics. So that's one way to look at it right is I need to learn how to do college research. And now I need to learn how financial aid works. And now we've got to figure out how we're going to choose a major. And now we're going to go work on our high school curriculum to make sure it matches with the colleges. But it's important to realise that all these topics interact with each other. So yes, results you get from your very first college test may create some choices. If the test scores are phenomenally good, you might say, Oh, well, maybe we can consider the more challenging schools. And if they're average or poor, and then you might be well, do I test again? Do I do some test prep? Do I change the colleges I'm interested in? And that could be set in this similar story around all the different topics?

Chuck Erickson
Yep. Or you call me and I tell you, oh, by the way, there are colleges that don't require ACT and SAT that your student would be a great fit for. And then that blows your mind. Like, oh, wait there options serve me, even if I have a bad test score? Yes. So yeah, each of these topics, the hard part of that I think, I don't know families understand is that all of these topics are essentially happening simultaneously. So it's like the old circus acts where the guy is trying to spin plates on pins, and all the plates have to keep spinning at the same rate, or plates start falling and going crashing. And what's great about working with one of us is that we can help keep all those plates spinning and help students understand the timeline and the process and families. So yeah, so you can order them organise them by project. But then the other one is that timeline is figuring out what starts first what starts second. And that's where we can really help because we understand what the deadlines are for the institutions. And for all the paperwork that has to get done around that area,

Brad Baldridge
right, you need to start this plan with the end in mind and understand how it all fits together. And it's a bit of a learning curve. I think many families, I think, learn this the hard way where the first kid is really, they really struggle. And they do the best they can, they realise they didn't do it very well. And then by the second kid, now they get to practice, they've had one practice run, now they get a little better. And then by the third kid, it's like we've got this all figured out, we now understand at the end of the process, we can fill out the loan applications. But at the beginning of the process, we have to decide if loans are appropriate or not, we don't want to get to the end and say, my only solution right now is loans because we didn't plan well. And now we're forced to loans because we have no choice. It's either don't go to college or take on some loans. Because we didn't plan well. You do that once or twice with the older kids and all of a sudden now you get better at it, you understand the whole process. And that I think is the biggest advantage of working, finding someone with some experience, or reading the books or whatever it is so that you really understand all the different pieces so that what you're doing your junior year is the right things so that when you get to your senior year, the doors aren't closed where you say we'll get to the senior year say well, we did the wrong things junior year, or we didn't do enough of the right things or whatever it might be. All right. Another way to organise the the timeline is by who does what, and I think that's where, even Chuck and I can do that you can say that right? That's Chuck's job. I don't get involved in that and check all say the same thing. But in the family realm, I think there's things that parents do. And they're what I work a lot on. So I can speak to those. But the parents are going to do the saving and investing. Parents are responsible to understand how financial aid is going to work for the family. The parents need to decide how much they can afford to spend, some families, education is export is very important. I had a dad not too long ago that he said, Well, my budget is 125,000 per student. That's all I'm spending. And most people would say, 'Oh, man, I wish I had that kind of budget, that would make our life so much easier.' But again, so it's it, every family needs to figure out how they want to do it, and what makes sense. But then I think the other important thing for parents to figure out is, is this realistic? Now you can say things like, well, we can't afford to pay for college, so they're just going to have to go get a bunch of scholarships. But is that realistic? Is your student in a position where they could get scholarships, even if they work hard at it? And right, of course, the second step is, how are you going to get into work hard at it? So I think the parents can start on a lot of the financial stuff, whether the students ready or not, I mean, how many children do we have? What kind of work can we afford per student? What makes sense? Where should we, if we can save and invest now, where should we put the money? If we can't save and invest? Are we willing to take loans? What is the process that is going to successfully pay for school? And then jack, I'll let you talk a little bit about what students need to do and how they do it.

Chuck Erickson
Yeah, this is another great example, as you said, it's a multi year process. And if, if I could make it work my way, I would have families check in with me even in eighth grade, because the high school classes so much impacted the college application processes in a lot of families think, well, freshman year doesn't really matter in high school. And and that's completely incorrect. Freshman year absolutely matters, the moment you step into high school, everything that you're doing in high school is going to be put on your college application. So I would love to start earlier with families just to have checking meetings and unders to help them understand the process. There are things that the student needs to be doing, which is focusing on grades and getting the best grades possible. They don't have to be 4.0s. But students need to put forth their best effort and the best, the more effort they put in, and the better grades they get, the more college opportunities are going to be available for them. parents do need to start thinking about, 'Okay, we need to show our kids college. So what the kids need to understand college and they need to understand jobs. But a lot of parents go, why doesn't my kid pick a major? Well, they don't know what the jobs are that are out there. So introduce your kids to your friends and what majors they do. But students and families can start doing colleges as they want. So there are things that each side needs to do. I talk a lot about parents about the finance thing as well. And up to my limitations of Okay, this is what you need to do to prepare for the finances. But I mostly am talking to students about everything matters. And I'm not trying to stress them out. I'm trying to help them understand that homework matters, grade matters, involvement matters, volunteering matters, work matters, biting matters, weeding matters, all those things matter because I think students don't understand the lengthy process that happens to be able to figure out what type of colleges and experiences are best for them. So, I always tell them, let's let's get started early and have those conversations and really help the student. I'm not trying to replace High School counsellors High School counsellors just have way too many students and not enough time to work with with students individually, I'm really an additional support for students who just aren't getting enough support that they need from their high schools or their high school counsellors.

Brad Baldridge
Absolutely. And I think what happens, another way to think about it is, inadvertently, I think sometimes doors closed, because we didn't do what needed to be done. So now, it's just not an opportunity anymore. And a lot of times, that's fine, right? You could do the planning and say, Well, these are the doors that are going to close because this is what we're going to do. And you would say, that's fine. We're not interested in those opportunities anyway. So we can go ahead and let those doors close. I think where people get frustrated is when you get to the end and look back and say, Oh, we did these things, and they closed all these doors that I wish were still open, but I just didn't know at the time that I I should have done that or I could have done that. Or I could have prepared this or whatever it is.

Chuck Erickson
Right. A perfect example is I've had students come to me as seniors in high school and they want to apply to certain colleges that require a Fine and Performing arts class to be taken in high school that some colleges require a year of find a performing arts. We get to see a year and I'm like, 'Well, you can't apply to those schools because you don't have that.' And they said, 'Well, our high school doesn't require it.' I said, Yeah, 'Well, your high school doesn't require it, but the colleges might.' So I help families and students understand what do your high schools need you to do? And what did the colleges need you to do? Because those are completely different checklists.

Brad Baldridge
Absolutely, yes, then high school is what you need to graduate is not the only list you're looking at. It's also what the colleges need. And also, I think what the student needs, as far as being prepared for whatever it is, they're, they're going on next may not be required anywhere. But the whole idea of I've had enough math, so I'm going to stop taking math my sophomore year, is, I don't know, whatever that is, but I think most of the time, you're gonna need to stay up on some of your core topics and subjects or in English and writing and that kind of the same thing of, I don't like it, so I'm never gonna do it again, kind of attitude can be very limiting.

Chuck Erickson
Yep.

Brad Baldridge
All right. Well, I think that covers our topic for today. Again, we've got 10 more episodes coming out over the next 10 weeks, covering all the various topics we just talked about. So we will hit each of them in much deeper detail. I thank you, Chuck for agreeing to record all these episodes, and I look forward to getting them all out there.

Chuck Erickson
Yeah, sounds great, Brad. Thanks for having me. And I'm looking forward to this journey.

Brad Baldridge
Alright, I hope you enjoyed that quick overview of college planning. We've got 10 more episodes coming up where Chuck and I talked about all the individual topics as mentioned, and again, show notes at taming the high cost of college slash 119, or 119. Let's go ahead and jump into Brad Recommends and then we'll wrap things up

Presenter
The latest tips, tricks and tools you can use today. This is Brad Recommends on Taming the High Cost of College.

Brad Baldridge
Today on Brad Recommends, I want to talk about our website. tamingthehighcostofcollege.com is our website where we host the podcast, where we've added a lot of additional resources. I've mentioned a little bit earlier that we took a hiatus from the podcast, but we'd have more time to work on the website. And again, our work is never done. The website is always a work in progress, we now have some great resources available at the website. So if you haven't been there in a while, you need to go check it out. For example, we've got an EFC calculator there, where you can input about 15 different fields about your income and assets and that type of thing. And it'll help you calculate what your EFC or expected family contribution. If you don't know what EFC is, well, then we're going to cover that in a future podcast. So stay tuned. There's also great articles about visiting colleges and planning and need-based aid, merit aid and all the different things that you need to understand. So again, great resources to be reading there, we have our Net Cost of College by State. So if you, for example, live in Arizona, you can go to the Arizona page and see all the colleges in Arizona, and what they cost based on your particular income. So again, there's four or five different prices for each college based on income. So you can look up your income and see, 'Oh, in University of Arizona, my income should be somewhere around this price.' Of course, there's a word of caution, as I always say that, the way it works out for you may be substantially different than the way it works out for others. So you want to always understand and apply this information specifically to your situation. And have a good understanding to know when the rules apply and and when they don't. But again, net price of college by state, there's a 50 minute lecture, there's probably one for DC as well. So there's 51 different state charts there where you can look up your state in state colleges and your private colleges. and gather again some preliminary data about what college actually costs these days. You can sign up for our newsletter at our website where we will send out this type of information on an ongoing basis as we create new material. You know, we put it out there as part of our newsletter. Another great resource is the Scholarship Guide for Busy Parents. So this is a quick video series that will help parents understand scholarships and how to apply for them and what scholarships really means. I find there's a lot of confusion around scholarships, and it's my way to hopefully clear things up a little bit and give parents a quick overview so they know where to go next. And of course the podcast is there. So we've got the all 119 episodes and growing that are available there, you can check each of them out, and the show notes are there. So if you don't want to listen to the entire podcast, you can just read through the show notes quickly, and then decide if it's worth listening to. Obviously, not all 100 episodes 100 plus episodes are appropriate for everybody. So you can look through the list and come up with the ones that make sense for you to listen to. So again, that's a little bit of information about our website. It's always a work in progress. We're always working to improve things. But our goal, again, is to help parents really understand how college works, how to build a good college plan, so that it's not so overwhelming, you can save some money in the process. Again, there's a lot of great free resources. And we're starting to build some courses and other resources as well. So, go to the website, come back off and see what's new. And that's all we have for today. I look forward to hearing more from you guys. Feel free to reach out to us. Let us know how we're doing. Give us some comments. Or if you have questions or concerns. Again, we're always here, you can reach out to us via email, or call our office. You can also reach out to Chuck if you need to go we're always here and available to help you however we can. That's all for this week. We'll see you next week.

Presenter
Brad Baldrige is a registered representative of Cambridge Investment Research and an Investment Advisor Representative of Cambridge Investment Research Advisors, our registered investment advisor. Securities are offered through Cambridge Investment Research Incorporated, our broker dealer and member of FIA, NRA and SIPC, Brad owns two companies: Baldrige Wealth Management and Baldrige College Solutions. The Baldrige companies are not affiliated with Cambridge Investment Research.

Transcribed by https://otter.ai

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THCC74 – How to Get Started in College Planning. Key Areas to Focus on First

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Are you just getting started with college planning? Not sure if you are on track? This show is for you! Expert Brad Baldridge helps you get organized with 4 key areas to consider for a smooth and simple planning for college process.

Organizing a Formal College Plan

The first step is to access where you are in the 4 plans to work on:

  • Visit Plan.
  • Test Plan.
  • Scholarship Plan.
  • Financial Plan.

“The whole purpose of the visit plan and test plan are to support your creating the school list,” states Baldridge. Earlier is better when it comes to having a school list, but students have to grow up and figure out what they want. It should be pretty well worked out by the end of a student’s junior year.

Each student and situation is different. When making a school list, one strategy is to make a larger list with 2 or 3 schools in the following categories:

  • Reach or dream schools that are unlikely to work out due to academic or financial reasons.
  • Target schools that are a good fit academically and financially. They would be a great opportunity for the student.
  • Safety schools which are places you are very confident you will be accepted and the financial side will also work out.

Another strategy is a shorter list with 2 or 3 local schools because you don’t want to travel too far or picking colleges that are just close to family.

Your ultimate goal is to have something to work with to move on to the other steps. “Start early so you have time to plan and it’s a little less pressure on the whole family,” stresses Baldridge.

Visit Plan

This is how you will gather information from the colleges you are interested in. Visit planning, for many families, is done during the junior year. Put it on your calendar and decide:

  • How I’m going to visit.
  • When I’m going to visit.
  • What I will do while I am there.

This coordinates with the test plan. “If you are visiting schools that require relatively high test scores, you need to work on getting the test scores required to be accepted,” explains Baldridge.

“Are you going to test and plan to get into the schools you are visiting? Or are you visiting the schools that your test scores indicate you can be accepted at?” asks Baldridge.

In addition to the actual visits, you can do college fairs and talk to college reps. There are some virtual tours available also for many colleges. See podcast Episode 18 on virtual tours: https://tamingthehighcostofcollege.com/18/

Test Plan

This goes along with visit planning. Some things to consider are:

  • How many times should I take the test?
  • Is it available at my high school?
  • Should I take the SAT, ACT, or both?
    • Find out which format works best for your student or is popular in your area.
  • Will there be prep in between?
    • Free online resources, classes, or one-on-one tutoring, etc.
    • The competition is doing it, so if you are planning for a more competitive school it might be something to consider.

Take the test in February, figure out if you need to do any prep work, then take it again in April. If you must, it’s also available in June and one more time fall of senior year.

“Understand your opportunities and what your plan is, then coordinate the test with your visits,” says Baldridge.

Scholarship Plan

See podcast episode 5  https://tamingthehighcostofcollege.com/005/  and episode 43  https://tamingthehighcostofcollege.com/how-to-help-your-student-win-scholarships/ for more resources on scholarships.

Free resource “Scholarship Guide for Busy Parents” available at https://tamingthehighcostofcollege.com/scholarships

Most families just need to do a basic scholarship search with 10 or less scholarships that are closely associated with your student or family. If you are going to apply to 20 scholarships, it will most likely be a family event with help from parents to search for these scholarships and get them done, which requires more time management.

Financial Plan

This is how college can be paid for which includes:

  • Pursuing aid.
  • Loans.
  • Scholarships.
  • Attending an expensive school or low-cost school.

This is the last thing parents need to work on and can be slightly independent from the other plans. “Focus on the information you DO know relative to the family,” mentions Baldridge, such as:

  • Savings.
  • Investing.
  • Qualifying for aid.
  • Income.

This is important because when you go on college visits you can then ask the right questions and even talk to the financial aid office.

If you don’t have time, or are starting late, don’t panic! “Pick up the pieces from where you are,” encourages Baldridge.

LINKS AND RESOURCES:

THANKS FOR JOINING US!

We are starting a new video series called, “The Scholarship Guide for Busy Par-ents.” It is going to be 4 videos that are 12 minutes or less complete with cheat sheets and other resources to help you find and win scholarships. If you are inter-ested in learning more about scholarships please visit:
tamingthehighcostofcollege.com/scholarships

We’d like to extend an invitation to our listeners to share their feedback and questions. Our website offers a couple of ways for you to share your questions with us, and we’d love to hear from you.
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