The month of August kicks off one of the best times in our industry: College planning season. Traditionally, college planning season runs from the beginning of August until the week of Thanksgiving. Due to the pandemic, the past two college planning seasons have been good but not great. This year, however, is shaping up to be an extraordinary year in college planning because, for the most part, colleges and universities are wrapping up summer vacation and finally getting back to a new sense of normalcy. Most college classes have transitioned back to in-person learning versus online Zoom sessions, with thousands of college-bound students across the country heading back to school in numbers we haven’t seen since before the pandemic. Colleges are now accepting more students than they were in the previous two years. More importantly college sports are back and students across the country will soon be filling up football stadiums, which is something great to look forward to.
I help families navigate one of their most expensive and important investments: Their children’s future success. While talking to families with children who are headed to college soon, the most common feedback I hear is that their students are excited to attend classes on campus again and get a taste of the in-person college experience. However, the thought of paying for their college on top of everything else they have going on is just too overwhelming, and many people will be looking for financial advice from a trusted expert. Our knowledge of the insurance planning industry is unique and can provide financial advice that a high school counselor or accountant simply cannot. I hope this gets you just as excited as I am as this is going to be a record-breaking college planning season…if it’s done correctly. Implementing college planning services correctly is key if you want to also grow your business and insurance production at the same time. I am always surprised when I meet an advisor who claims to be a college planner. While they’re explaining their process to me, they usually start by saying that they’re hosting an in-person educational workshop or dinner seminar that promotes college planning. In reality, the focus of many of these kinds of events are based on how to fill out a FAFSA form correctly and sheltering assets to hopefully lower the family’s EFC in hopes of getting some sort of financial aid award.
At this point, you might be asking yourself the same questions: How is this considered college planning, and how does this help families get their children into the college or university of their choice? Those types of seminars I previously mentioned are tarnishing the work that real college planners do. If the main focus of a college planner is not getting kids into the right school, then they are not real college planners. Personally I don’t blame them because, 90 percent of the time, advisors are not training correctly on how to offer these types of services to clients. An even worse scenario would be that their upline was only concerned with training them on how to sell a quick MEC life insurance policy or a short-term annuity. Again, how does purchasing a MEC life insurance policy help get any student into school? Don’t get me wrong: A properly structured MEC life insurance policy can help many families lower their EFC and is also included in the “Five Ways to Pay for School” model, but by no means is this a catch-all solution that benefits every family with a college-bound student.
That’s why it’s very crucial that, when a financial advisor wants to get involved in the college planning sector, they need to partner with a BGA that specializes and understands the full scope of college planning services. This consists of: 1) personalized one-on-one training on college planning and how to identify funding opportunities; 2) a proven marketing system to get in front of qualified prospects; 3) guidance with sales presentations that focus on getting students into school; 4) a step-by-step guide on how to conduct a webinar or seminar; 5) software which helps to manage your relationships; 6) a funnel to getting potential clients to book their first appointment; and, lastly, 7) case designs that can include 529 accounts, MEC life insurance policies, annuities, and fixed index life insurance policies. The most important factor to consider in each of these areas is that we are always focused on how our services can get students into the right schools.
As you can see, there are a lot of steps you need to take in order to become a successful college planner. I use the “Five Ways to Pay for School” model to provide each family I help with a few different college funding options. If done correctly, then you are not selling a family a college funding plan but, instead, you are explaining the pros and cons of each college funding option based on their unique situation and letting them pick which option is best for them. For example, if you are working with a family that makes over $250k in combined household income, and with the changes to the EFC (Expected Family Contribution) formula to a new formula called the SAI (Student Aid Index), even if they move all of their non-qualified assets into an annuity or MEC life insurance plan they will not receive a nickel in financial aid. Instead, a real college planning BGA will include an option using a max-funded fixed index life insurance policy. We often find that these types of high net worth families are more concerned with how to use their assets more effectively while ultimately teaching them how to become their own bank. I have found there is not a better solution available which can help pay for school tuition while also being able to provide a tax-free retirement income than a properly designed max funded index life insurance policy.
Bill Zimmerman, who is considered one of the original great leaders in the BGA world, used to say, “It’s not about what you have, but instead it’s about what you give. We are directly compensated by the benefit we create for mankind.” I could not agree more with Bill because that is essentially what we are doing in the college planning world. When college planning is done correctly, we are taking one of the most stressful financial hurdles a family may endure into a pleasant, non-stressful, educational experience. More importantly we are helping their children attend the right schools so they can achieve their future dreams. Like I mentioned earlier, this college planning season is going to be one for the record books. We are going to help a lot of familys’ dreams become a reality while also making a positive impact on the world.