Episode #286- College Financial Aid Season

0:00Hey, hey, podcast listeners. This is Craig Stromb. Welcome to my podcast. I am glad you are here. My goal is to give you a unique perspective on the financial world from the vantage point of a 25-year financial industry veteran. Remember that I am not giving you specific advice just encouraging you to break away from the herd and challenge conventional wisdom. If you like my take on things, be sure to subscribe. Let's get into this. Hey, everybody, Craig Stromb, certified financial planner, the income engineer, paralegal at an awesome law firm, all those great things. I am glad you're here wherever you're watching this content, whether it's on YouTube, like and subscribe. If it's on Facebook, leave a great comment. Follow the page if you would, share it with a friend. This topic might interest you, especially if you're a parent of someone getting ready to head off to college.

1:04It's that time of year again. College admission season might be saying, well, wait, Craig, that's not until September. Well, that's that's a very short amount of time when you're a parent and your child is getting ready to go off to college admissions world. In September, it'll be blink of an eye. It'll be overquick. And some schools want their applications and everything in by May or even earlier, some private schools. I spoke with a really nice couple just recently. Their child was up against a surprise deadline that actually happened in, I think, February, right at the end of January. They wanted to get applications in and this was a private school. So bottom line is it's college admission season almost all the time. If you're getting ready to send a kid off to what has now become an extremely expensive venture, right? The high cost of

2:06tuition is a big stressor for families. Back in 1990, the average tuition cost for a four-year public school was about $3,190, $3,190. Fast forward to today, the average cost nationwide is $10,000 plus. $10,000, that's an incredible increase. Basically, from all of the government money, the loans, the grants, all of that flowing into the education system has, of course, economics, driven up the price. So that's why it's important. Take advantage of all the resources you have available to you. One key step to completing the free application for federal student aid, right? FASSA and the CSS profile is to meet with a qualified, hopefully certified financial planner, maybe even your attorney to go over your estate planning, your business structures.

3:06It's very important that, as you're completing the FASSA and the CSS profile, that you determine what your expected family contribution is so that you then know what your potential is for financial aid. Proper financial planning is crucial at minimizing your expected family contribution. Folks will say, what's your EFC expected family contribution? What does that mean? It's exactly what it sounds like is, what does the government or the school think that you, as mom and dad, grandma's and grandpa, should be contributing to your child's education? What is your contribution amount? Now, things like retirement accounts, certain assets like retirement accounts, and primary residents, business assets like limited liability companies, S-corp's, businesses with less than 100 employees, for example. Those should not be, in some cases, many cases reported

4:12on these applications, but it's a big mistake, I see it all the time, that assets are reported incorrectly, assets that could be positioned properly to be both safe and protected from creditor attack and also excluded from, for example, the FASSA application. Good family estate planning can often uncover opportunities that both benefit in the asset protection arena and also on the FASSA expected family contribution arena. It all has to be done right and reported accurately, but remember, when it comes to college student aid and admissions, seeking qualified financial and legal counseling can be incredibly beneficial. So please, don't hesitate to reach out, whether it's to me or another financial professional, just find out whether or not they have an acumen in that college planning conversation. Good luck, seriously, to all the students and families

5:19of those soon-to-be college students out there. It is a big deal. And one quick note, just a side light here that I want to get off track for a quick sec, but I talked to some folks, as I mentioned earlier, just recently, a couple of weeks ago, and one of the areas that I'll always suggest, having gone through this with my daughter, Madeline, is community college. I got to tell you my personal experience with the higher education system was frustrating. The higher education system, as you heard me say earlier, has gone through a tremendous inflation in cost. You know what they haven't inflated? Student services. The quality of the education. The quality of the interaction with the student. I'm telling you, my experience or my daughter's experience at a big name university, it was terrible. It was so impersonal, it was so cold. The education was not great for the amount

6:23of money that was being charged. Her room and board was terrible. All of these things, and I'm thinking, wait a minute, this is an extremely expensive school compared to others, and yet she just wasn't getting it. She finally understood that community college might be something that she should check out. She checked it out. A world of difference. She got her higher education back on track, better service, better education, better professor student interaction, and it saved us a tremendous amount of money. My daughter will come out of college now with far less debt to worry about, because honestly, I told her that she would have to worry about the debt, that I would not go into debt for her. I personally would not go into debt for long term debt to pay for her education. So she's going to have to figure it out. Well, thankfully, she went through community college,

7:26came out minimal, minimal debt, and she got a great education at community college that translated to her higher education needs for her degree in nursing, and she'll be finished this year in 2023. So that's my soap box moment. Talk to your kids about college planning. Now is the time. You've got a very short window coming up in this college admission season. If you've got questions, feel free to send me an email. Craig with a K at CraigStrom, K-R-A-I-G-S-T-R-O-M dot com. Feel free. Reach out in time. I'm always willing to see if I can help. Take care. Talk to you again soon. Information presented is for educational purposes only and is not intended for solicitation, sale or purchase of any security or financial product. Be sure to first consult with a qualified financial advisor and your tax professional before implementing any strategy discussed here. The term personal pension refers to a marketing name designed to educate future retirees and

8:28retirees about the economic principles behind creating their own pension like income. The term personal pension is not intended to be confused with a defined benefit pension plan offered by an employer or by a government entity.