Planning ahead for college is key

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Planning ahead for college is key, but options exist for latecomers

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Original Article: Sun Sentinel   |   Written By: Brian Ballou


The soaring cost of college requires that families plan early and carefully, financial planners say.

Some even advise saving as soon as you know you are expecting.

“I couldn’t stress enough the importance of starting early. It alleviates one of the biggest financial burdens that most families will ever have,” said Mari Adam, president of Adam Financial Associates Inc. in Boca Raton.

There are online resources for parents to guide them on how to save, including and, sites that are run by professional financial planners and include vast amounts of information on how to save and what plans to take advantage of.

For those who want personal advice, a one-hour session with a financial planner can range from $100-$300 and it may take multiple sessions to create a plan.

Some agencies charge a flat fee for the service, which could range from $1,000 to $2,500. It generally includes follow-up advice as a family’s financial situation changes with a ‘life-event’ such as the birth of another child or a job change.

“A typical session will focus on finding out how much a family can save after fixed expenses,” Adam said.

The priority is mortgage, retirement, and food and utility bills. Families should also keep at least a three-month reserve fund in case of emergencies. Add all that up, subtract it from income, and it will give you a better picture of how much you can afford to save for college,

Coming away with such a blueprint can save tens of thousands of dollars in the long run. There is an old adage often on display in the offices of those who offer financial advice: “Failing to plan is planning to fail.”

College financial aid offices are often inundated with questions from families seeking to find ways to help pay for college.

“Desperation is something that we see every single day,” said Sue Vickers, the associate director of financial aid at Florida State University. “For the most part, when they get to us, they are at a point where their need for financial aid is great, like a lot of families. Obviously, using a planner early on would put families in a better position.’’

Theresa Cowan, Broward College’s associate vice president of financial aid, said she’s noticed an increase in the numbers of parents who go to financial planners as their child approaches his or her college years.

“A lot of parents do come informed. We’ve noticed that many are using tax preparers or financial planners,” she said. “They are coming in well-versed on all the options out there, Bright Futures, 529, grants and scholarships.”

If you’ve put off saving until your child’s high school years, then it’s crunch time, planners say.

Among your options: seeking financial aid, having the student get a part-time job or attending a local community college. Since tuition makes up a third of college expenses, living and eating at home will greatly defray the overall cost, experts say.

Experts strongly discourage parents from dipping into their retirement accounts to help pay for their child’s education.

“There aren’t any loans to pay for old age, but there are to pay for college,” Adam said.

The first order of business is to figure out your household budget, said John Ulin, a certified financial planner who runs Ulin & Co. Wealth Management in Boca Raton.

Families should go over their income and expenses. After the necessities are accounted for, the amount that a family can contribute to college savings becomes more clear.

“Putting your child through college should not be a competition with your neighbors, or a rivalry on Facebook to see whose kid got accepted to the most expensive or fancy Ivy League university,” Ulin said.

“Make sure to use common sense and planning when it comes to college financing. You don’t wan’t to send your kid to off to Harvard if they’re looking to teach at Palm Beach Elementary,” he said.

Harriet Brackey, a senior wealth manager with BDO Wealth Advisors in Fort Lauderdale, says the important thing is to get started.

“If you make a financial plan, you’re far more likely to start to work seriously on reaching your goal,” she said. “If you don’t have a plan, things are more vague, just ideas swirling in your mind that may never happen. When you put numbers next to the goals, that act brings you much closer to action.”

Brackey says the entire amount to fund college doesn’t have to be available on the first day of college, that some expenses can be paid along the way.

At the current rate of about $20,000 a year for in-state college tuition and expenses, that’s $80,000 for four years of college.

“One way to think of it, it’s almost like buying a new car every year for four years,” Brackey said.


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