How to Think…About College Planning in a Pandemic

Clients’ growing investment in college education creates new opportunities and hazards. Planners should know the landscape going into 2021.

Journal of Financial Planning: January 2021


David C. Bowman CFP®, is a co-founder of College Aid Pro (, founder of Outsourced Planning (, and CFP® In Residence of the What is Finology? Project. Through these endeavors, Bowman helps advisers across the country modernize their practices and deepen their client relationships.

Joe Messinger, CFP®, ChFC®, CLU®, is partner and director of college planning at Capstone Wealth Partners (, and a co-founder of College Aid Pro ( He is a trusted authority in the area of college planning, creator of the innovative College Pre-Approval™ Process, and is frequently asked to speak to professional groups and parents to demystify the college financial aid process.

“The students file past the ivy into the oak and dust of the ancient classroom. On this first day of class, they anticipate their initial steps on a professional journey that will lift them to the pinnacle of prestige, power, and authority.” In these opening words of his 1990 landmark article, “To Think…Like a CFP,” the late Richard B. Wagner, J.D., CFP®, invoked the awe of induction into the world of higher education. He went on to make a case that financial planning, done properly, constitutes an essential profession in our society. To call ourselves essential workers in today’s context would not have stretched his belief in our professional destiny in the least.

Wagner’s message to readers of the Journal of Financial Planning 30 years ago continues to resonate and remind. We as a profession have the privilege of partnering with our clients, and our communities, as they navigate the powerful “money forces.” If that doesn’t sound precisely like what you do for a living, don’t worry. Dick regularly anointed us with cosmic responsibilities, while not always providing a blazed trail from one’s current location to the promised land. In that gap, he invited us to explore our potential.

What we as planners trained for yesterday will not necessarily suit us for tomorrow’s challenges. So it is with college. When we checked in 2016, the Foundations of Financial Planning course book contained 1.5 pages on college planning material. EE bonds made the cut for this professional preparation in guiding families through the college funding maze. The need-based aid formula (cost of attendance – expected family contribution = demonstrated financial need) was absent. A more recent look at the CFP® coursework did not reveal an encouraging expansion on the subject.

Just 30 years ago, when Wagner wrote those opening words, it’s almost inconceivable that his memory of law school was tainted by decades of repaying his student debt. The playing field has changed, and we must adapt if we’re to accept our responsibility as trusted professionals.

The Case for College Planning

A parent who attended Notre Dame in 1988 paid $9,600/year in tuition, assuming they paid full price. Their son or daughter entering Notre Dame under the same circumstances next year will pay $57,700. That’s just tuition. The all-in cost of attendance is $76,883. These numbers will stop parents with two or three smart kids in their tracks. Pile on the guilt of “not saving enough” and the anxiety of launching their young ones into a world beyond their supervision. Now, let’s include the option for a Parent PLUS Loan well in excess of market rates and without any financial qualification. Parents are commonly either resolved to the fact they will be borrowing heavily, delaying retirement and other goals, or they are frantically trying to decode their options for cost reduction.

In fact, 73 percent of parents say paying for college is their number one financial concern. Let that sink in.

Our ideal clients have an acute need—their highest financial concern—and they are searching for answers. And resources are available to financial planners who want to include late-stage college funding advice among their services. Notable examples include the Savvy College Planning training available through education provider Horsesmouth and the Certified College Financial Consultant (CCFC) designation offered by the American Institute of Certified College Financial Consultants (AICCFC). This is an opportunity for serious disruption. The education system is broken for most Americans. It is a black box. It is a marketplace without price transparency. We need to bring solutions and access to the table, and we can.

In a previous article, “A New Approach to College Funding Advice,” we described a process for understanding the landscape of an investment in the traditional four-year undergraduate degree. The framework we proposed is designed to systematize the assessment and selection of college from a financial perspective—a framework for making an informed buying decision. In its simplest form, our approach is about choosing schools that fit within the family’s budget and their self-imposed maximum student loan amount based on the net cost of the school after need-based grants and/or merit-based scholarships.

While that level of practical acumen should be foundational for anyone serving parents of teenage kids, it’s much more common for planners to project education expenses for their clients based on the school’s cost of attendance (the sticker price before the aforementioned discounts). Traditionally, planners will then help clients save as much as possible and compare borrowing options for an often staggering gap in funding. We can do much better.

College planning is an investment decision, one that often exceeds $150,000 or even $250,000 per child for undergraduate studies. What other investment of that size would we be comfortable not providing guidance on? Shouldn’t we be conversant in at least the basic concepts of financial aid and school selection? Should we perhaps help the people we serve understand their likely financial outcomes under different scenarios, so they can make informed choices?

Trends in the Traditional Path (Four-Year Degree)

For the majority of families we serve, the traditional four-year undergraduate degree is still the ideal. However, the COVID-19 health crisis has further complicated this vision. The foundational questions of cost versus quality remain relevant, but how are these factors impacted by the crisis? Some schools have transitioned to an online-learning delivery, and while this may be an acceptable compromise to earn a degree from an elite institution, the value seems less clear at less-prestigious schools.

What about those schools that have decided to continue offering an in-person experience? Is this safe for kids while they’re on campus? How about when they come home for the holidays? However you feel about these questions, schools are incentivized to close when there is a perceived health threat. Each institution has its own protocols and policies and not all are created equal. This is becoming apparent at schools like University of North Carolina, Chapel Hill, and Notre Dame, which have chosen to shut down campuses mid-semester in response to runaway infection.

Other schools, like Tulane University, have adopted strict measures for students, staff, and faculty, including compulsory testing, off-site sequester, and temperature screening before ever stepping foot onto campus. Generally speaking, private schools have been faring relatively well in comparison to their public counterparts, exercising more precautions and finding better results. Many schools have created “COVID dashboards” to keep stakeholders updated on the situation and trends affecting their campuses, and there is even a We Rate COVID Dashboards website that ranks schools on the effectiveness of their attempts at transparency.

How does all of this impact the economics of the estimated $600 billion a year industry of higher education?

By and large, the effects have yet to be fully felt, but you might want to start looking at metrics like a school’s endowment dollars per student or their Forbes’ College Financial Health Grade. UNC Chapel Hill’s chancellor estimated an economic impact to their institution of greater than $100 million, so far. Some early analysis by the Center for American Progress indicates Chapel Hill is far from being the hardest hit as colleges face a perfect financial storm.

State schools are losing public appropriations funding, partially offset by the CARES Act relief. Schools moving to virtual delivery are refunding pre-paid expenses like dining and housing, a major source of revenue in a normal year. Meanwhile, they’re also spending heavily on digital-learning infrastructure and retrofitting campuses in the hopes of returning to on-campus life at some later date. In perhaps a less-intuitive blow to their financial stability, many universities with major medical centers are often taking even larger hits to revenue from planned procedures being postponed.

What does this mean for clients? Most major institutions will likely be able to weather the storm with cuts in other areas, alumni donor drives, and the prospect of further government stimulus, but some schools will almost certainly close the doors of entire departments, if they don’t close altogether. One might hope for a cut in tuition given the obvious shift in the value proposition from that of a complete experience—including interactive classrooms, social and professional networking, enrichment and extracurriculars, and study-abroad opportunities—to one more heavily leaning on the all-important college degree. We’ll very likely see mixed results on this front. Schools’ generosity with need-based financial aid packages could retract in some cases to offset losses, even in advance of the 2022 freshman class whose parents’ prior-prior-year tax returns (the tax return used for assessing income on financial aid forms) should demonstrate higher financial need in the aggregate.

And while many schools are saying they’re shifting to a test-optional stance given the difficulties the incoming class of 2021 is having with simply finding open testing centers where they can take the ACT or SAT, the jury is still out at the time of this writing until the late winter and early spring. That’s when many applying students will be receiving merit-based scholarship offers based only on their GPAs, essays, and qualitative academic merits. With each school system being a relatively sovereign entity, we might expect some schools to make a good-faith effort at providing financial incentives for the most promising students, and others to drastically reduce their merit awards in the hopes this will go largely unnoticed in an already opaque process.

A bit of additional vigilance at this point is warranted. Understanding financial aid awards is absolutely key. TuitionFit is a new subscription-based tool allowing students to upload their awards, then compare them to what similar students received at other schools. If the student opts in, they can then receive unsolicited offers from other schools as well, potentially matching them to a much more affordable education at a comparable institution. And with recent changes to the ethics rules of the National Association for College Admissions Counseling (NACAC) in the face of antitrust action from the Justice Department, colleges are now free to market to students well after what was previously a May 1 agreed-upon deadline for direct marketing.

This increased competition among schools into the later months of a student’s decision-making process makes a software like TuitionFit even more powerful. It could mean significant savings if schools begin providing deep discounts to fill their classrooms late in the season. This seems likely in a climate where 350,000 fewer returning students have refiled their Free Application for Federal Student Aid (FAFSA) compared to the prior year, a reduction of nearly 5 percent. This data might indicate an uptick of the most devastating of higher-education outcomes: borrowing for school without completing a degree program.

We should take note that this trend of students not refiling their FAFSA is heavily skewed toward lower-income households below $25,000 in earnings. Among this cohort, returning applications were down more than 8 percent from the same time in the prior year. The trend disproportionately affects BIPOC (black, indigenous, and people of color) students. The pro-bono and outreach efforts of the Foundation for Financial Planning, Financial Planning Association chapters, and planners across the country could potentially have an outsized impact if focused on addressing this acute issue affecting the next generation of working Americans.

On the whole, planners should be aware that universities are reeling, and their changes in policy could mean additional costs for the uninformed consumer of higher education. It could also create significant savings opportunities for savvy applicants willing to shop their options among schools. In certain cases, there may even be grounds for special circumstances appeals, either citing economic hardship from the pandemic if such hardship exists or requesting reconsideration for merit scholarships given a student’s inability to sit for standardized admissions tests. A simple letter from the student to the financial aid office stating their case could potentially save as much as six figures over the course of four years. We believe that strategy alone makes a sufficient case for planners to embrace late-stage college funding as a core skillset.

After the Dust Settles

So, what are graduates facing once they walk and receive their diplomas? The landscape is certainly shifting providing both new opportunities and some very real dead ends. We’re facing a truly unique job market for new graduates. While unemployment has spiked, the pandemic has also forced the hands of employers across the country to embrace work-from-home policies. Gig-economy platforms and the rise in outsourcing also make it more viable to monetize your skills while considering your options.

For those who are having trouble getting the first foot in the door, the traditional fallback plan of service work is less likely to be a reliable safety net. Opportunities to wait tables, valet cars, and caddie at the local golf club are likely to be harder to come by with increased competition for vanishing positions.

Most federal student loan programs offer an automatic six-month forbearance from the time of graduation before payments begin, an additional six months of total optional forbearance for financial hardship, and various payment plans designed to give borrowers repayment flexibility. The democratic platform has also been increasingly incorporating some form of debt relief and/or education reform, though it’s not clear what shape that would take, if any, in the near term. Federal borrowers currently in repayment are encouraged to keep a close eye on changing relief options.

The truth is that student loan debt is the second-largest single asset of the U.S. government, second only to checkable deposits and currency. Wall Street also has a financial stake in private student debt. What does this mean for borrowers? The counter incentives to prompt a fundamental change in the status quo would need to be substantial. We see excess student borrowing as one of the greatest financial headwinds, not just to young earners, but also for their parents and the economy as a whole. Thirty-eight percent of all federal student debt is held by people age 35-49 and another 21 percent is held by people age 50 or older.

We’re not political analysts, but we see forgiveness of some amount of federal debt, either by executive action or as part of a larger stimulus plan, to be a likely first step, if one is taken at all. This would not help future borrowers, however, and would probably only tee up the topic for more thorough consideration on a long list of pressing agenda items. What we can do now is help parents and the next generation of clients understand there is a better way to shop for college and plan for success—one that doesn’t require six figures of debt.  

A Call to Action

We’ll leave you with our simple belief that we can’t do nothing. Our clients need our help with this major financial decision. The good news is that planners across the country are beginning to see the opportunity to make a difference and be rewarded for listening to the needs of the market. With a bit of education and the right tools, you can make a world of difference 


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  3. See the Gallup 2001-2015 Economy and Personal Finance Survey at
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  7. See Bill DeBaun, “New Data: Nearly 250,000 Fewer Low-Income FAFSA Renewals This Cycle Nationally,” from National College Attainment Network, at
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  9. See Financial Accounts of the United States for Q2 2020 at
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