College Scams

Avoiding College Scams With a Phony College “Expert”

If I had a nickel for every time a parent came to me and said “Well I heard “such and such” from this guy that came to my kid’s school” I would be a very wealthy man. My goal for this article is to show you ways to spot college scams and fake college “experts.”

Unfortunately, more than 60% of the people masquerading as “College Planners,” “College Savings (something),” or just simply “College (something),” are charlatans and partake in college scams.  Most sell insurance under the guise of “College Savings,” or simply get you to fill out college loan documents and charge you thousands of dollars, or want you to refinance your house.  Most of these people don’t even have college degrees!  Indeed, some of the largest “College Planning” companies in the country are headed by people who don’t have college degrees and sell some form of insurance or annuity as a way to pay for college.  There are even people who train insurance salesmen to masquerade as “College _____” to sell insurance policies.

Phony Indicator #1: They ask for your 1040, W-2, or 1099 instead of your kid’s GPA, Class Rank, or Test Scores.  If they ask for your 1040, W-2, and 1099, they are looking at how much money they can make off you instead of what they can get for your kid.

Phony Indicator #2: How many scholarships did they help their students earn last year?  If they say “there are no scholarships,” or “you don’t qualify,” pack up and leave.  Now some of these guys will have students who get scholarships by default – simply because the student sent in an application and they had high enough scores to get a scholarship without any help from your “College _____.”  So see if their scholarship total exceeds $1 million.[1]  If not, leave! These are college scams.

Phony Indicator #3: The Test.  Ask the following questions:

  1. Name the Ivy League colleges. A true college expert can rattle this off.  A charlatan will bob and weave, and guess.  If they can’t rattle this off, it’s like a “doctor” who can’t name the bones in your forearm.  You wouldn’t want that “doctor” performing surgery on your forearm, much less a charlatan giving you phony college advice on your biggest family investment.  Indeed, if this “expert” hasn’t placed student in an Ivy League college, he/she isn’t an expert and you need to leave.
  2. Name the Service Academies. Again, a true college expert could rattle this off.  If he/she can’t, you need to leave.  Indeed, if this “expert” hasn’t placed student in a service academy, you need to leave quickly. These are college scams.
  3. What Percentage of Parents’ Assets are Factored into the EFC? There are a lot of charlatans trying to pass themselves off as “College Financial Planners.”  If they can’t answer this question, it’s like a doctor who doesn’t know if your blood pressure is too high.  You wouldn’t want that doctor and you certainly don’t want that “College Financial Planner.”  Leave quickly. These are college scams.

[1] We have had students individually exceed $1 million in scholarships

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