Head Of The Class

Walker recently authored the book Never Pay Retail for College to clarify what she does, reach a broader audience, open doors and boost credibility with high schools and other professionals (especially CPAs). She conducts educational workshops wherever parents gather—from soccer club and church group events to financial aid nights at high schools. She and Schultz have also found clients through their talk radio shows.

Messinger always points out that Capstone isn’t a college planning firm but rather a financial planning firm for college-bound families. “It’s a subtle nuance, but it’s a big difference,” he says. “We can attract great, lifelong advisory clients by helping them with this acute issue.”

He refers clients to experts in the non-financial aspects of college planning, the same way he might refer people to tax and estate attorneys, CPAs, money managers and insurance experts. He networks with college admissions counselors, independent college consultants and test-prep tutoring companies.

In its first five months, Capstone College Partners put 60 to 70 advisors through its online training program—a much greater response than Messinger anticipated. He’s seen interest from some advisors affiliated with broker-dealers. But it’s not yet clear how they can make money through college planning, he says, and there are uncertainties about compliance. “It’s not securities advice or insurance advice, so where does it fall?” he says.

Capstone College Partners also farms out its services to advisors who need the help but otherwise don’t have many college planning clients.

Keeping Compliant And Current
For compliance reasons, Schultz is careful to keep her college planning and financial planning practices separate. She will only speak to families about specific college-related investments if she has a signed financial agreement with them—and then she puts on her RIA hat (she’s also the co-founder of two other firms, Westface Financial Advisory and Westface Financial and Insurance Services).

Most of her clients work with a private admissions counselor to develop a list of colleges to apply to, but she then helps add or eliminate schools to fit the financial part of the equation.

Some college clients have hired her for long-term planning needs. And she gets lots of referrals. People in groups often freely admit they are lost when it comes to college financial planning, she says, “whereas there’s no other part of their financial picture that they would share with people at the side of the soccer field or with their neighbors at a cocktail party.” 

Advisor Sean Flynn has focused on college planning for the past five years. His expertise in this subspecialty—an interest initially fueled by the needs of his friends and neighbors—is a big reason he was hired by Connecticut-based Essex Financial last year, he says. About half his clients have children under the age of 18, and the others are grandparents having conversations about college. Flynn, who has the certified college planning specialist credential, also helps his colleagues do college planning for their clients.

“College planning is lock and step with retirement planning,” Flynn says, noting that about 50% of the new clients he brings in through the educational seminars he conducts sign on for full financial planning. He also offers à la carte college-planning services. He’s working on building relationships with more CPAs and college counselors.

Advisors don’t have to be in a wealthy college-focused market like Fairfield, Conn., to get involved in the space, however. “Even in a small town, the 529 business we do is good,” says Brent Courter, an Edward Jones advisor in rural Loogootee, Ind. (population: 2,700). “It’s really about educating people.”

“I plant the seed of saving for college in my clients’ heads,” he says, and the majority of them are now talking about long-term planning for college. He’s found it most effective to start conversations through the grandparents of newborns.

Education on college planning is starting to pick up. The College for Financial Planning doesn’t offer a specific program related to college planning, but it addresses the subject in nearly all its programs, and the CFP certification program has an entire course module dedicated to it, says Chris Allen, the organization’s director of marketing.

The College for Financial Planning will host a live webinar on college planning on October 10, and it offers a continuing education course. “I fully expect us to develop additional college planning content in the form of webinars, CE courses, white papers and course modules within our existing comprehensive programs,” Allen says.

Messinger offers some parting words on college: “It’s a $250,000 investment—we think you can’t call yourself an advisor if you’re not advising on it.”