financial advisor technology

Ep. 98 – Taking the Emotion Out of College Planning with Joe Messinger, CollegeAidPro

“There’s so much emotion wrapped up in this college buying decision, we’re saying can we help families shop smarter. You can be proactive instead of reactive using our predicted outcomes that provide about 90% accuracy for out of pocket costs, and we can have those conversations when they’re a sophomore of a junior, not when getting the award letters. We create price transparency by providing the net cost projection of every school in the country, and the reality is every family is going to pay a different price. It’s like buying a seat on an airplane, everyone paid a different price, and it’s very similar in a college classroom.”

— Joe Messinger, co-founder and CEO, CollegeAidPro

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Companies Mentioned

Topics Mentioned

  • CollegeAidPro’s Mission
  • How Many Advisors Consider Themselves Experts in College Planning?
  • Higher Education as a Luxury Good
  • Price Transparency
  • Decumulation for College Planning

Complete Episode Transcript

Craig: I’m excited to welcome to the program Joe Messinger, co-founder and CEO of CollegeAidPro. Joe, welcome.

Joe: Hey, thanks for having me Craig, happy to be here, man.

Craig: I’m happy you’re here as well. It’s been a while. We’ve had a couple stops and starts to this as this happens with busy executives trying to line up meetings and I’m glad we were able to coordinate.

Joe: Yeah, for sure. I look forward to look forward to chatting today.

Craig: Joe, where are you calling in from?

Joe: I am in beautiful sunny Sarasota, Florida today.

Craig: Lucky you, man. Nice.

Joe: It’s a great place to winter, not a great place to summer.

Craig: How long have you lived there?

Joe: Actually through COVID last year, my significant other has lived here for several years. I came down with the intent of coming for a month or so and ended up being here for six months and discovered that I no longer want to have northern winters. I’d been in Columbus, Ohio for 15 years before that and yeah, you don’t have to do it I found out.

Craig: I always enjoy telling people about how bad the winters are in New Jersey but I’d never do that with Midwesterners.

Joe: Yeah, the Midwest is interesting because all you got to do is just go to sleep and the next day it’ll probably be different.

Craig: Well I’m glad you’re here on the program but we’re not here to talk about the weather, or where we live, but we’re here to talk about your product CollegeAidPro. Can you give us a 30-second elevator pitch of CollegeAidPro?

CollegeAidPro’s Mission

Joe: Sure. Our mission is to help every family make an affordable college choice. So to unpack that more, how do we help every student graduate with little or no student loan debt without robbing mom and dad’s retirement? And really what we feel to do that, number one, we have to raise the bar on college funding advice in the industry. And if we do that we can end the student loan crisis at its cause, doing things proactively instead of reactively. And to do that, our goal is to empower advisors with the right software training, support and community to help them have success helping families make more informed college buying advisor technology

Craig: That was a great overview. So, I like your product I as we were talking earlier, I have three daughters, two of them have gone through college, so I went through this experience on my own, no advisor was helping me and no software was helping me and I’ve just done the third, she’s just gonna start in September but I really could have used your software. The question is, why did you found this company, what was the impetus behind starting it?

Joe: My story right is I’ve been in the financial services industry since 2001. And so this is my 20th year. And I worked for big companies for about a decade, and rose through and made the, I don’t know if it was a poor decision but got into leadership about five years in and help build sales teams and run regions and kind of burned out on that for a number of reasons.

But my partner and I saw a huge opportunity to, number one the fee only movement was beginning. So we wanted to go to a fee only platform. We also saw a huge gap in college funding and how this whole thing works. At the time, so I’m about 32 at that time, and my friends were graduating from grad school, law school, MBAs those kind of things. And they were coming out said hey, you’ve been a financial advisor for a long time how do I work with these loans and how do I do this, and I said, I have no idea. We’ve never been taught that,. But you’ve been a financial planner for 10 years. How do you not know this stuff. So we continue to unpack that we find out that like look, I’ve asked top advisors from some of the top firms in the country. Nobody knows how financial aid works, nobody knows how this thing really works. We were never trained on it.

That’s what we found, so we saw a big opportunity and fast forward, we start Capstone Wealth Partners which is my RIA in Columbus, Ohio, and we work with families for about seven, eight years and we’re still doing that today. And then the industry started calling saying hey what are you doing, how do you impact this? So my partner, and one of the co founders of CollegeAidPro, David Bowman and I started basically a training and consulting company, helping people. We built a 10 hour course on college funding.

So the CFP curriculum has about 1.8 pages, we developed a 10 hour course. So a little bit of gap in that. That kind of evolved into us, meeting up with Matt Carpenter and Bill Rabbitt who run one of the college funding consulting firms in the Northeast, and they were trying to build a technology for the consumer to help them scale their business and work with consumers. And I said well you know we’ve got hundreds of advisors who have gone through our course, and they’ve said, at the end, this is all great, what software do we use? And I said they all kind of don’t really fit the bill for the way that we look at college, so we set out on this mission intentionally to say let’s build a business to business SaaS product that advisors can use with families because we think there’s nobody better prepared to be that human guideposts than a financial planner, but most financial planners really just don’t have the resources, tools and training to do it the right way.

Craig: That’s for sure. Yeah, definitely the training isn’t there. I didn’t realize you created a course that’s really interesting, seems like a great way to get yourself educated on it as well because you never learn something as well as you do when you try to teach it.

How Many Advisors Consider Themselves Experts in College Planning?

Joe: There’s a way to mastery right is to teach it, you have to get in front of other CFP professionals. I started doing a lot of speaking and for XYPN and FPA and all the associations. You’re gonna make sure you have the the razor sharp when you go into those engagements and it’s interesting, just kind of an anecdote is I’d go into these rooms and there’d be 100 CFPs, great financial planners, many of them I know and respect, I’d say hey, how many of you have an advanced designation in CFP or CPA. Now every hand goes up, right. I say how many of you would consider yourselves experts in college financial aid planning? And like one hand stays. I said see now look at this, we have an issue here because 73% of parents say their number one concern is how to pay for college and navigate the process yet 99% of you say we don’t do that. So we saw a big opportunity there to raise the bar on college funding advisor technology

Craig: It’s a huge concern, speaking as a parent who’s gone through it three times, and I’m an avid spreadsheet maker whenever I’m making a decision, a financial decision whether it’s buying a house or a car, probably too much. But we also did it for college because it’s so hard to keep track of what college said what, what scholarship did they get, what age did they get. So having it automated, and seeing the demo of your software, I was like oh man, why didn’t I have this, but there’s lots of calculators out there that do college calculation and planning, and every college has a calculator that does things as well, so how are you different than just a calculator that figures out college costs?

Joe: We set out on a mission, how do you build this thing from end to end, because all these pieces, people with spreadsheets, it’s these calculators, everything’s so bifurcated, and we said how do we help guide a family through this process? How do we guide families, help parents be the hero, have great outcomes for kids? So if you start with that the solution becomes the build itself, and we had built this out of spreadsheets for years, and we would do the calculator, get what they call an EFC, we go to the school and get a net price calculator to try and get an idea what it costs. But the reality is many of those net price calculators are extremely misleading. Our software is actually more accurate, more sophisticated than the net price calculators on the websites themselves for the college.

So case in point a concrete example, we’re yet to find a net price calculator on a school’s website that can equate for a divorce situation. And that’s crazy because it’s half the people out there. And many schools the way they address that, it can swing significantly by what they think you can afford so it’s things like that but at the end of the day it’s starting with a process and a framework. So when we talk about this it’s this idea of every student coming into this process is a snowflake. Because there’s things in this process that you may not know, but our software if you put the right things in, will give you the rest of the answers. So spend five minutes getting input in CollegeAidPro will do the rest. That’s kind of the whole idea.

So if we think about that too, there’s a few factors in there that we say our five part framework is how much colleges think you can afford, that’s the number one because now the question is, can you get need based aid, how much can your family actually afford. That’s a novel concept. Creating a budget for college. So that’s a process we call college pre approval. If you think about that, if college had to be pre approved for every student in this country, like we do for a mortgage, we wouldn’t have the student loan problem we have.

Number three, how do we find schools who are going to be generous with financial aid for us and our family. Because what your neighbor tells you, and the average is at the schools, that’s very dangerous. So how do we find those schools that are generous because, if you go do the tour at some of our top universities, you’re at Harvard in the student’s walking backwards, giving you the speech and hey, the average student here only pays $12,000 and you’re like, Cool, well am I paying zero, or $85,000, because there’s a big swing there so it’s really about what is our family going to pay. Highly, highly, highly tailored, because it comes down to, what’s it going to cost us to pay for all four years of college, and more importantly, if we go and make this decision, what’s our delta, what’s our college funding gap? What’s our resulting student loan, more importantly, what’s that loan payment, because that’s where the rubber really hits the road for a student. All the numbers about 100,000 or 10,000, young adults that’s funny money to them. But if you can create a thing, and we show outcomes to say look, here’s what you’re going to come out making from this college from this degree. So literally down to the degree from that university compared side by side, here’s your outcome. If that loan payment is more than your first year salary, that total loan, that’s not a great choice. So it’s really all the way down to helping people just understand what is a good decision because sometimes we don’t know.

Higher Education as a Luxury Good

Craig: That is really a key issue that I found, what is the delta, what’s the net, and trying to figure out what that is and you’re right, I definitely saw a difference between what the calculators on the websites promised or said you would get versus what actually came out. So, I have a million questions for you, let’s see if you know the answer. Every college seems to have a list price, which is really high. But then they always say well no one pays that. So why do they have it, why do they do that?

Joe: I think there’s a couple of different perspectives on it but if you think of it in terms of cache, if this school costs, $75,000, they must be better than the school that costs $50,000. So the schools have gotten in this price war to where they continue to grow their cost of attendance and their tuition, so they’re basically saying we’re going to subsidize this cost but if we don’t cost something comparable to another school, people are going to perceive that our value is not as good when the reality is the value is net cost. We want to find the great deal and it’s crazy with college we put on these blinders and we’ll go pay whatever they tell us, and the problem with it is most families don’t find that out until they get the acceptance letter and that first bill. And then at that point it’s too late because that young teenager did everything you told them to do, they got the grades they got the ACT, they launched a spaceship when they were 12, they did all the things to get into these great colleges all the while thinking, Oh, we’re gonna get scholarships or whatever but, then you’re stuck because telling the other kid that did everything you told him to with an acceptance letter to Cornell or Yale, good luck. Parents get steamrolled and the whole idea of the price elasticity that’s out there, the average private school discounts tuition 52.9%. That’s the average, that means some schools discount even more. But it really comes down to that whole idea of if we don’t price high enough, then we’re not gonna have the relative value to these other schools.

Craig: And that’s exactly what I found, it’s like a luxury item, it’s like why Tiffany charges more for the bag and you could buy the same diamond ring or bracelet at another store, you want that Tiffany bag. You want that Yale sweatshirt, the parents want the sweatshirt so you know they could afford to send their kid to Yale, and we say the average discount is 50% percent or more. That’s what I heard and what I read as well and it all becomes funny money but one thing I’ve always said going through this college experience is that college is the only service that you beg the vendor to pay, please take our money, you don’t do that anywhere else, and certainly not for these prices, it could be over $100,000 or $200,000 or more that you’re committing to, and you’re begging them to take your money.

Price Transparency

Joe: And the interesting thing is there’s so much emotion wrapped up in this college buying decision. So we’re saying can we help families shop smarter, if you can have a runway and you can be proactive instead of reactive and we can give you a predictive outcome of about 90% accuracy or out of pocket, and we can have those conversations when they’re a sophomore or junior, not when you have award letters.

We’ve created price transparency, we’re going to give you a net cost projection of every school 3,000 schools in the country. And the reality is every every family is going to pay a different price. It’s kind of like when you sit on an airplane, everybody might have paid a different price for that seat, and it’s very similar in a college classroom, you’re going to find your discounts for you and your family and that’s that whole idea of, every student is a snowflake in here. Even a brother and a sister from the same family, the family’s financials may be the same but their academics are different, so their opportunities for merit scholarships change so we used to say it’s by the family but now it’s by that student.

I have case after case where low income families I gotta tell you, they’re rolling out schools based on the sticker price more than anybody. So our idea of impact and making affordable college choice, they’re not looking at this the right way because what we know is if you look at some of our top 50 schools out there that we all know the name of, none of them have scholarships. None of them have scholarships. Why is that? Well, everybody who got in has a 36 ACT and is a valedictorian and, they’re like well we couldn’t decide who to give scholarships to. So we’re just gonna award based on need, yeah we cost $80,000 But if you have financial need we’ll meet 100%. If you are low income family, the example I give this year and I have one every year, really talented student, inner city kid, mom worked two jobs, but they were only looking at junior college and a state school. So I said what’s your dream college. He said Georgetown, I said cool, well Georgetown is probably going to be more affordable. Come to find out this year, he’s going to Georgetown for half the price of Ohio State.

That’s the kind of impact we want to make through advisors, but also every family in America deserves to have this transparency and we feel like our long term goal is to have every family shop smart for college, including those that need it the most and even some that can’t afford a financial advisor.

Craig: So Joe, one of the some of the features I want to go through with you that I really think are cool about CollegeAidPro. Can you talk about the apples to apples comparison and how you do it differently than other tools and why a parent can’t do the same thing?

Joe: Well I think one of the thing when we set out to build our advisor workstation, it was really built as a financial planning software. I think a lot of the applications out there for solving this thing are really built for the consumer, and you can’t really manage a lot of clients in it so ours is really you know built to the akin of an eMoney or RightCapital where you can manage your clients, and it’s really built on seeing into the future.

So when I think about when we talk end to end, here’s the four year cost, what’s your budget, what’s your delta, what’s your loan, what’s your loan payment. So if everybody can see that, I call it like future me, right, like if you can help somebody see into the future because our job as planners, is to help people see into the future and what the impact of these decisions are, but a lot of times with college we’re accounting. We’re accounting for the past because we have this big bomb at the end, where if we can help people more proactively plan, more proactively see, and then also the other part of that is, everybody comes in with their four or five schools that they’re interested in. But often times, all of them are way out of budget. With our advanced search tool, you can shop for schools like you can shop for airlines on Orbitz. So you can tell it, I want to see schools within a day’s drive that have my business major, that are Forbes ranked and I just want to see schools are going to give me the most merit scholarship. It’ll give you a rank order list of schools within a day’s drive that are getting the most scholarship, and then from that form you begin to chop down and find schools might be better for you.

I really feel like that advanced search on top of everything, because if every school that you’re interested in is way off your budget, the question is, what do we do now. That’s really what I feel is of the most powerful things that we do is in that advanced search. Like I said, shopping and putting your criteria in exactly what you want.

Craig: That’s really helpful. I mean, speaking as a parent you had to do these searches, it’s hard to find. It’s hard to get the information you have, you’re constantly typing in what is the total cost. I want the total cost of ownership, and it’s hard to find some schools present it, here’s all the fees. Some obfuscate, you got to search around, you got to click multiple places. For example my daughter, if I could do a humble brag, my daughter is in the five year Occupational Therapy program, and trying to figure out what that costs is a little tricky. She got some scholarships, yay, which is great, merit scholarship, but it only is for undergrad, and she’s in a five year program so that only covers the first four years, what happens in the fifth year, I don’t know, what’s the cost, I don’t know. I had to go back and forth with the financial aid people so how does CollegeAidPro help with that situation?

Joe: I think it’s providing a source of truth. We’re going to project what you get, but ultimately the schools are going to come back and you’re going to have to analyze those awards. So we have an awards analysis tool where you’re able to look and say okay, this is what it costs for the four years, what does this fifth year mean?

Part of what’s inside of the software is if you can compare and contrast you can also appeal for an additional eight. Understanding, part of this process too, is we’ve got six great schools that may be competing for this great student like your daughter to say, Hey look, you gave us $20,000 a year which is awesome but this other school gave us $25,000. And what we found oftentimes is, if you have that informed conversation, you can go back to that admissions office and they’ll oftentimes turn around and match that offer. But when I talk about the true north, what is our truth here? Here’s actually what it’s going to cost.

Reading financial aid award letters, kind of to your point, there’s no standardization. We’ve seen over 400 different financial aid award letters and they’re wildly confusing as to how they present things. They call things like student loans and work study financial aid, where those things don’t actually cut your costs to college. So for a family it’s really confusing and they call Parent Plus loans financial aid. It’s a loan. How do you break through this, this intentionally opaque process where they’re trying to disguise loans as financial aid, to really get to your point, what is actually going to cost me? The tool really helps, I think, really shows you here’s their cost of attendance broken down by travel costs, miscellaneous, tuition, room and board, and then here’s what they gave you in form of aid, because that really gets down to your net cost, and then you extrapolate that over four or even five years, and understand that.

Craig: Yeah man, you’re preaching to the choir. This rings so true when I hear all this. That always killed me when you get the the admissions letter or the letter with the merit scholarships, and they say you got a loan of x 1000 that’s reducing your cost. No it’s not, it’s just deferring my cost, a loan is not a merit scholarship it’s a loan. But they throw that in the show, see your net cost is really this much. No it’s not, I still have to pay that money back, or my daughter does.

Decumulation for College Planning

Joe: I was gonna say just to piggyback on that too, one of the things we see is traditional financial planning software, it only shows you the sticker price. And people have asked, well how can you predict this stuff and etc, etc, I say how can you not? The reality is, most people aren’t paying sticker price, ours is much more accurate than traditional financial planning software. We pick up where it leads off all the way down to one of the things we’ve talked about is most people with college that they’ve saved when they get to that first student, they’ve never decumulated money. There’s a lot of talk of retirement income planning but with college, it’s a short amount of time to save and it’s a short amount to decumulate. Being really smart and understanding what goes into that, including yes, the scholarships but we’ve got our cost, what can we cashflow, what’s coming from 529, what’s coming from grandparent help. Our tool is like a sandbox to really help the family visualize, here’s exactly how you’re going to pay that bill. And oftentimes that’s really what’s extremely powerful, and that’s what I think is missing. And financial advisors saying we don’t do that, we have to elevate what we’re doing and help people make informed decisions and actually help steward them through that process so they don’t take things like Parent Plus loans that are extremely expensive. So I really feel like this idea of a human guidepost for the financial planner is important.

Craig: Dude, you’ve got to put that on the website, that is the most… That’s something I’ve never heard. You said decumulation? I’ve heard you decumulate obviously, I’ve heard it a million times but always only in the context of retirement. I’ve never heard the word decumulate apply to college and it’s absolutely 100% true, it’s a decumulation event. You’re shelling out a ton of money that you expected to, but yeah, how do you optimize and if there’s tools out there that just make a living on optimizing decumulation and retirement, you can save time. You’ve got to put that on your website, the decumulation part, because that’s a huge savings for parents. My mother in law did a 529, we had some 529, I set up a Roth IRA for my kids because they were working for me when they were younger, we had an IRA, where do you take the money from and in what order. That’s huge.

Joe: There’s a lot of benefit to it you know one of the planning opportunities that exist there too, because you know software can go to some extent but it’s literally like going into, should we use grandparent monies in the latter years? And the answer is yes because if you’re a financial aid candidate and that comes in improperly, that can disrupt your future financial aid.

It gets into the strategy and the training and I think part of what we do too, we do a bi-weekly roundtable for advisors, and you know it’s a grab bag but there’s always something topical. We’re releasing new stuff all the time but that bi-weekly roundtable has really become a great way for us to get provide demonstration and show, here’s how this could work.

We bring on other advisors from the community. I think advisors learn best from other advisors, not just from their successes but from their failures. And hat we’ve learned is you know, our community has informed the software as it is today. You know, we set out on this mission, we said we’re gonna go build a B2B because we saw it as a great way to build revenue, what we didn’t know, the unintended consequence was turns out you get 250-300 certified financial planners banging around in software, they’re gonna tell you what’s wrong. They’re gonna tell you what features are missing. I didn’t think about that, but man, the feedback loop is just phenomenal.

I have to say thank you to everybody that’s been an early adopter. We’ve been around for about three years and we would not be anywhere close to where we’re at without the help and the constant push as some of our advisors say. We recently launched a private scholarship search right within the software and we said do we really need it? And the advisors said yes, the families put so much emphasis on it, why not? So all those features and benefits, that constant feedback loop we have with our community, I get tingles when I think about what we’ve been able to build and the relationships that myself and the other co-founders have with our with our advisors on the platform, it’s really special.

Craig: Alright we are running out of time, which I expected because I had a million questions. The so in the last five minutes I want to get to a couple things that we’d spoken about. Can you give us some advice as a founder of a company, what advice would you have for other advisors in your position who have an idea to start a software company? What are some of the mistakes you made that you want to give them a warning about.

Joe: If you’re looking at building some type of wealthtech, we have to build our own solutions in this industry many times, I would say be cautious who you work with from a development standpoint. We did have some false starts there, where we built some prototypes. So, I would make sure that you’re definitely considering it like an RFP process. Don’t just meet with one and they they sell you meet with 2 or 3. One of the things that kind of guided us too is, whenever there’s something we’re looking for, be it legal advice or accounting or developers get three quotes. Get three quotes make an informed decision right, curate that don’t just take the first one that comes in the door. That really has served us well from finding the right price, finding the right partner that’s aligned with our values because we’re mission driven so we need to find partners that are mission driven, and that’s another piece of putting that out as like an RFP. Don’t just take the first offer, make sure you’re doing your due diligence for hiring people, for bringing in outside consulting, all those things. That would be something that has served as well but burned us early.

Craig: And speaking as someone who runs a consulting firm, I can say watch out for consultants. Be careful. Anyway, another thing I want to let you talk about before we finish is the marketing hub, new cool new feature, can you tell us about that?

Joe: Yes, we’re calling it the CollegeAidPro marketing hub, and what it gives us is the ability for teams to now collaborate. If you have two advisors or 2000 advisors, an administrative panel now allows you to have oversight over your entire platform. So when folks come in, many families come into we call it our college money report. It’s a free college money report it’s a diagnostic and a lead capture tool, so those come in, you can then distribute those out to your team of advisors, based on however you want. But even more powerful I think is our data analytics that are in there so we’re going to help you slice and dice graduation year what advisors have how many clients. Very, very detailed reports so as you develop and capture leads those things all sync up with your CRM, and those things to build your mail campaigns. So, the marketing hub, we take a kind of a custom approach of building an airtight funnel for your for your organization, and that’s what the marketing hub allows us to do because data and intel is what allows you to have more informed campaigns, instead of a shotgun approach. I feel like when we built that out, even for my own firm, it what it’s done for us being able to share and have my administrative team do what they need to do and have an advisor say Hey, can you check out this case for me ping me with an email. The whole idea is to really make it really simple and easy to do college planning the right way for a whole footprint.

Craig: Love it, great product I’m really excited we got time to talk. Can you give a tell everyone who’s listening where they can find out more about your product.

Joe: Go check it out, and when we book our demos one thing I’ll say is, it’s more of a discovery call. This is something that we know is intimidating for a lot of advisors in institution because it’s something that, quite frankly, we’ve never been trained on and we don’t know how to monetize it. But I can tell you if you get college planning right, you will get the rest of the business. I’ve learned that over the years so visit us, book a demo and like I said it’s really about exploring how can we support you, either as getting you propped up or or even be in a back office for you with CollegeAidPro.

Craig: Speaking as an advisor to other advisors. Joe it’s been a pleasure. Thanks so much for being here.

Joe: Thanks, Craig. Appreciate it man.

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The Wealth Tech Today blog is published by Craig Iskowitz, founder and CEO of Ezra Group, a boutique consulting firm that caters to banks, broker-dealers, RIA’s, asset managers and the leading vendors in the surrounding #fintech space. He can be reached at