Do You Really Need a College Financial Aid Consultant?
Would you trade $500 for $2000? How about $10,000, or even $40,000? If so, than read on.
Let me start off by saying that hiring a college financial aid consultant is not absolutely necessary. Many families manage to put in the time and effort to research the financial aid process, and end up doing just fine. Having said that, I’ve seen firsthand how being uninformed and making mistakes when it comes to financial aid can lead to devastating consequences.
A friend of mine (we’ll call him Rob) is a prime example. He hired a “financial aid consultant” to help him navigate the bewildering financial aid system when his oldest son was applying to colleges. I don’t know the exact qualifications for the man who showed up at Rob’s house to “help” him, but, he was clearly not qualified. Rob’s son was subsequently admitted to the expensive private school of his choice (which was no surprise, since it wasn’t a selective school), and they paid full price for the privilege. The son graduated, and now, 4 years later, both Rob and his son are still struggling every month to cover the payments on over $80,000 in student loans. I look incredulously at Rob and ask him, “What were you thinking?!?” His response: “We just didn’t know.”
So if you want to be sure that you’re informed about getting the most free college money, you may want to hire a professional. Let’s take a closer look at college financial aid consultants:
- What does one have to do to become a college financial aid consultant? They must go to their computer and print up business cards with their name, phone number, and the words “College Financial Aid Consultant” on them. That’s it. There is no governing board or regulatory agency to qualify, regulate or monitor them. It’s up to you to determine if they are qualified.
- What does a college financial aid consultant charge? Most reputable college financial aid consultants charge a fraction of what admissions consultants charge, and will probably end up saving you a lot more than what you paid.
- Exactly what does a college financial aid consultant do? An ethical, qualified college financial aid consultant will tell you all about the financial aid process. They will answer questions like: What is financial aid? How do I apply for it? How much can I get? They will inform you about grants, scholarships and student loans. They will also provide you with advice on exactly how and when to apply. They will go through the applications question-by-question, making sure that you answer each one accurately. They will help you sort through financial aid award letters, and help you determine which offer is the best one for you. If there are special circumstances, they will help you submit an appeal to the financial aid office.
- What does an ethical, qualified college financial aid consultant NOT do?
- They will not ask you for your PIN in order to complete the FAFSA for you. That’s illegal.
- They will not tell you to lie about your income or assets in order to receive aid your wouldn’t normally qualify for.
- And they will never, NEVER offer to sell you an annuity. Some insurance agents have realized that parents who are applying for financial aid are “ripe for the picking” for buying annuities. Why is that? Because annuities aren’t listed as an asset for financial aid purposes. If a family has $100,000 in investments (stocks, bonds, CDs, etc.), that amount must be listed as assets on the FAFSA. However, if they liquidate all of it and buy a $100,000 annuity, they don’t have to list it on their FAFSA, and they may be eligible for more financial aid. Don’t be fooled. Anyone who offers to sell you an annuity is an insurance agent, not a college financial aid consultant.
If you’re looking for an ethical, qualified college financial aid consultant, there are two main questions to ask:
- Have you ever worked in a college financial aid office? This answer should always be “Yes”. There are over 7000 federal regulations that deal with financial aid, and only someone who has worked in the “trenches” can really know the ins-and-outs of the application process, eligibility, packaging, etc.
- Are you licensed to sell annuities? This answer should always be “No”. I have run into many of these “financial aid consultants” who make a KILLING selling annuities, but don’t offer very good financial aid advice.
So now that you know the ropes, don’t end up like my friend, Rob. Like hiring a tax preparer when you don’t know much about taxes, hiring a qualified, reputable college financial aid consultant can make a scary, confusing process easier, and can even save you money.
This entry was posted on Wednesday, December 3rd, 2008 at 12:36 pm and is filed under free college money. Follow the comments through the RSS 2.0 feed. You can post a comment, or leave a trackback.
