Copy write Strategies For College, Inc. 2015

College Planning&

Funding StrategiesCopyright Strategies For College, Inc. 2015

Did You Know?

• 68% of Americans are unhappy with the way they financed college

• 54% wish they had attended a less expensive school

• 27% wish they had delayed going to college so they could have saved more money first

Source: Journal of Accountancy, April 2015

12 Years of InflationTuition 2003 2015 % Increase

Northeastern $24,467 $43,440 +77%UMASS $7,482 $13,443 +80%Boston Univ. $28,906 $46,664 +61%Univ. of Vermont $22,688 $37,844 +67%Univ. of Michigan $25,733 $41,906 +63%Furman Univ. $22,712 $44,668 +97%

Why Worry About Funding Higher Education?

Data from National Center for Education Statistics (https://nces.ed.gov/collegenavigator/), and the Princeton Review, 2015 edition

2013 2014 20150

20

40

60

80

100

120

140

160

180

9

71

160Colleges With Costs > $60,0002013 - 2015

Why Worry About Funding Higher Education?

Source: Strategies For College Annual Update, 2015Princeton Review, The Best 377 Colleges, 2015

Do you know how bad the 4-Year graduation rate is?

39%

Why Worry About Funding Higher Education?

Because $1.2 Trillion in College Debt Is Crippling Students, Parents And The Economy

Source: Forbes, August 7, 2013

Why Worry About Funding Higher Education?

Source: Fidelity College Grad Study, 2013

Why Worry About Funding Higher Education?

50% increase in use of retirement funds to pay for college

Source: April 2013 survey by Fidelity Investments

Spending Plans After College?

Source: Upromise survey, May 2015

We will continue to send our children to college!

However …

Key Questions:

How Much Will It Cost Today?

What’s more important? Cost? Clout?Both?

True or False?

• Not a single Ivy League college awards merit scholarships

• Retirement Account balances are required to be reported on FAFSA in investments section

• There is a criminal penalty for knowingly submitting false or misleading info on FAFSA

Develop a PlanStart EarlyRetirement FirstRemain Open-MindedDon’t Refuse OPMDIY May Not Be Best OptionProtect Family Financial Well Being

The Effective MindsetProvide, Protect, Preserve

Paying For CollegeEffective Mindset Understands This

Your Hard Earned Money (YHEM) Past (assets, investments, savings)

• Present (income) • Future (loans)

• Students• Parents

Other People’s Money (OPM)• Financial Aid Grants• Merit Scholarships• Athletic Scholarships• Tuition Discounts• Other unknown sources

Colleges will calculate the EFC (Expected Family Contribution)

If the EFC is less than the Cost of Attendance, the family is “aid eligible”

If the EFC is greater than the Cost of Attendance, the family is not “aid eligible”

The Effective Mindset Seeks Understanding

Always, Always, Always…

RUN THE NUMBERS!ALWAYS CALCULATE YOUR EFC

LEARN HOW TO REDUCE YOUR EFC

Expected Family Contribution (EFC)

Parent IncomeMax assessment = 47%AFTER ALLOWANCES

Student IncomeFM assessment: 50%after first $6,130IM assessment: $1,850 min, then parent rate.

Parent AssetsMax Assessment: 5.65%AFTER ALLOWANCES

Student AssetsFM assessment: 20%IM assessment: 25%

Parent Contribution + Student Contribution =

Expected Family Contribution

Case Study #1

• Family of 4 (1 in college), lives in MA• Some key factors:

– Income <$100,000 per year– Home Equity $655,000– Business Value 1) $1,000,000, 2) $100,000 – less

$600,000 liabilities

So what does the EFC look like?

EFC Calculation

RESULT?

• Based on an early read of the family’s EFC, the student is now looking only a schools using the Federal Methodology – potential savings:

$160,000!

And Then…

• CPA had a GREAT IDEA! Take a dividend – TAX FREE!

• Saved roughly $18,000 in taxes• Lost roughly $38,000 in college grant eligibility• That’s a -$20,000 decision!

• Still a “GREAT IDEA?”

Case Study #2

DO NOT BE DECEIVEDBY STICKER PRICE!

Cost of Attendance

EFC from FAFSA

Financial Need*

Average % of need met with grant aid**

50% 60% 85%

Estimated Grant Aid $7,500 $15,000 $38,250

Estimated GAP

$7,500 $ 10,000 $6,750

Potential Net Cost of College

$17,500 $20,000 $16,750

$25,000 $35,000 $55,000

$10,000 $10,000 $10,000

College A College B College C

$15,000 $25,000 $45,000

Don’t Be Deceived By Sticker Price –Is it possible to be eligible at one college but not at another?

* Maximum need based aid eligibility.** For discussion. Does not reflect any particular institution’s statistics.

Next: Getting Funding

• Now that you understand how to pay for college… how do you make sure the aid will be there?

• Need to understand the concept of

Enrollment Management

Enrollment Management & Financial Aid LeveragingIf you are looking for money, where is the risk? The opportunity?

Can afford 75% – 100% COA

Can afford 50% - 75% COA

Can afford 25%-50% COA

Can afford 10% - 25% of COA

Top 25%

2nd 25%

3rd 25%

4th 25%

Student rank inadmittedstudentpool

Ability to Pay: College’s assessment of FAFSA and/or CSS Profile

25

A B C D

4

3

2

1

Enrollment Management & Financial Aid LeveragingIf you are looking for money, where is the risk? The opportunity?

Can afford 75% – 100% COA

Can afford 50% - 75% COA

Can afford 25%-50% COA

Can afford 10% - 25% of COA

Top 25% Merit $$$$(If available)

Grant $$$$ Grant $$$$ Grant $$$$

2nd 25% Merit $$(If available)

Grant $$ Grant $$ Grant $$

3rd 25% Full Pay(Merit??)

Gapped - Gapped + Gapped +

4th 25% Full Pay Gapped - Gapped + Gapped +

Student rank inadmittedstudentpool

Ability to Pay: College’s assessment of FAFSA and/or CSS Profile

26

A B C D

4

3

2

1

Objective Assessment of Applicant Profile & Competitive Position

Objective Assessment of Applicant Profile & Competitive Position

Well Thought OutFinancial StrategyFor Each College Year

Well Thought OutFinancial StrategyFor Each College Year

Family & StudentPriorities Addressed“Best Fit”

Family & StudentPriorities Addressed“Best Fit”Win - Win Win - Win

Strategies For College, Inc.“Integrated College Planning”

Strategies For College, Inc.“Integrated College Planning”

The Prime Objective

Affordability + Getting In + Fitting In + 4 Year Finish

Quick Lookup Resources

CSS Profile: https://profileonline.collegeboard.comCSS Noncustodial Profile: https://ncprofile.collegeboard.comFAFSA: www.fafsa.ed.gov Federal PIN: www.pin.ed.govPrivate Scholarships: www.fastweb.comFederal Student Aid: www.studentaid.ed.govCollege Navigator: http://nces.ed.govSFC Blog & Newsletter: www.collegesearchgameplan.comSFC Member Website: www.collegesearchgameplanmembers.comStrategies For College – DIY http://www.strategiesforcollege.com/diy.php

The Beginning

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