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It's Time to Get Real About "College Planning"

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As September winds down, so does National College Savings month. All month, we’ve featured posts and tips about saving for college, but today I wanted to end the month by sharing some of my thoughts on typically a rarely mentioned aspect that needs to make its way into the daylight.

Having a kid go to college is a proud moment for any parent. It’s the culmination of years of hard work and a college acceptance seems to serve as a psychological verification that “yes, indeed my child has met the standard.” Don’t get me wrong, an opportunity at a college education is certainly something to celebrate, but I want to step back for a moment and examine how that standard is truly affecting us.

In my lifetime, this standard has seemed to be an amorphous evolution from one that celebrates the potential of educational and career options, to one that as some schools now pronounce “college or die.” Well, let’s look at it on the flip-side of “college or die” for a moment. If the kids who end up going to college meet society’s standard, what’s that say about the many kids who don’t?

Does it mean they failed because they didn’t get there? In many places, it seems like that’s becoming the prevailing attitude. I’ve noticed a greater stigma around the kids who don’t end up going to college. Many well-to-do parents refer to them in hushed conversations, using phrases like “well he ended up…” and “she didn’t quite make it…” when talking about these kids. It’s like they became part of a group that was lost the moment their path diverged from the college standard.

But that’s the thing, these kids shouldn’t be considered lost. The college path just isn’t the right one for them. I think we can all admit that college is definitely the place for some kids given their skills, but for others it’s just not. They have a different set of skills, and there’s nothing wrong with that. We just need to be cognizant to nurture those skills just as much as we nurture the skill set of kids who are college bound.

In fact, economically, we NEED people with a variety of skills, many of which aren’t found or learned in college. Instead, they come from trade or technical training, a vocational or apprenticeship program, or even simply self-discovery as long opportunities are available. If everyone had the same college-bound skill set, there are a lot of things, many of which are valuable and which society depends on, that would break down.

Don’t get me wrong, I’m not blind to what the economy of the future will be and how it will continue to require thought over labor. I discuss this with clients and their children all the time. But, sometimes we need a big reminder that college isn’t the only place a kid can go to develop critical thinking skills! And that’s where I believe continuing to use going to college as the test as to whether or not a kid has met society’s standard is flawed and needs to be re-evaluated.

So, I bet you’re asking now how does this relate to financially planning for college? Well, for starters, I think a change of name is in order, from college planning to higher education planning. Sure, these kids may not be getting a college education, but they are still getting a higher education. Beyond the name change, this realization and an honest conversation on it should be the first step in the planning process.

Parents, you know your children, their aptitude, their abilities, and their motivations. You can tell more than anyone if college will be right for them or if another path will serve them better. And when it comes to planning financially for higher education, these facts are essential to knowing which options, vehicles, and strategies should be utilized for the best results. I’ve seen many people waste a lot of money trying to push their kid through college when it’s really not the right place for them. Instead of trying to force a square peg into a round hole, better and less expensive results are achieved if we do planning with the square hole as a viable option from the start.

For example, say you have a kid who’s great at working on cars. Well, it’s typically less expensive to plan to cover the cost of a trade school. If you think that’s probably his path that in advance, it’s crazy to continue to blindly contribute the same amount to a 529 Plan each month. That money may be better utilized going towards building your retirement, paying down debt, or building up a secondary fund that will cover expenses that 529 Plan won’t.

Funds for a junker car and parts may not sound like higher education expense, but if it helps to enhance his education to eventually get a good job in the auto industry, why shouldn’t it be valued the same as a college student’s textbooks or lab fees? We have to wake up and realize this because if we don’t we can’t effectively consider it as an option when planning.

One trend that thankfully is bucking the college standard for these kids is a push for vocational training opportunities that’s growing in some high schools. These programs allow the kids to not only utilize their unique skills, but potentially obtain certifications that can put them on the path to a successful career. I recently visited my alma mater, Pike High School, and couldn’t be more excited about their program that does just this, the Pike Career and STEM Center. The students are able to use their natural abilities that may not be part of the college bound skill-set, but get the chance to learn that it’s okay because they’re great at HVAC, cosmetology, or cooking, and those skills can take them places too.

From a financial planning standpoint, these programs can be fantastic for families. If your kid gets career training or a certification he or she can use to go right into the workforce, that’s higher education that now you don’t have to pay for. It becomes money that can be used to achieve goals in other areas of your life. But again, when planning financially for higher education, we have to make sure to consider these options and go the step beyond simply saving money for “college.”    

Moving forward we need continue to challenge the college-only standard when planning for how to financially prepare for higher education. College is a great opportunity for many kids and there’s definitely value in a college degree. But we also need to make sure we remember that a non-college higher education is valuable too, and make sure to consider it as a viable option when planning. If we do this, we’ll not only work to ensure all of our kids get a higher education that works best for them, but we’ll also put families in a better position to prepare financially for handle how to pay for it.

Mychal Eagleson, CFP®, AAMS® is the President of An Exceptional Life  Financial, a firm that specializes in financial planning for teachers and families with special needs. He frequently writes and speaks on personal finance topics relating to these clients. Mychal also serves on the board of the Financial Planning Association of Greater Indiana as the Director of Public Relations & Social Media. To read more of his articles or learn about An Exceptional Life Financial please visit: www.anexceptionallifefinancial.com.