3 Families on Tackling College Tuition in Delaware and Pennsylvania
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Illustrations by Jon Krause
Three local families break down their strategies for paying tuition for colleges and universities in Delaware and Pennsylvania.
From building supplies to produce, prices are going up—and college costs are truly soaring. According to CNBC, they ballooned more than 25 percent from 2009-19. Back in 1978, a typical private college education cost the current equivalent of $17,680. Forty years later, the average tab is $48,510. In 2021-22, a student attending Princeton University will pay $77,690, all in.
Not every kid is going to Princeton—but that doesn’t mean paying for college is easy. Here are the stories of three families who made it work.
Better Late Than Never
In early 2013, Ann D’Antonio’s son was a junior at Bishop Shanahan High School in Downingtown, Pa. Like most kids his age, he starting to think about where he might want to go to college. But when Ann and her husband, Joe, saw the price tags of the schools he was considering, they were worried. “We had a little bit of sticker shock,” says Ann. “We were thinking we were OK and would be able to figure things out.”
Even so, the D’Antonios needed a plan. “After some sleepless nights worrying about how we would do it, we decided to do something,” Ann says.
Around that time, the couple came across a mailer from Elite Collegiate Planning. Part of the Chester County-based Paradigm Financial Group, Elite was founded by David Kozak, who’s also the CEO of the nationwide College Planning Group. When they contacted Kozak’s firm, it was a little late for their son. Their daughter was graduating from Shanahan in a few years.
It wasn’t easy, considering the timeframe involved. The D’Antonios also had some debt issues to work out, and they didn’t have a mountain of savings. Truth be told, they were living almost paycheck to paycheck. Originally, they assumed they’d incur some debt to pay for college—even if it had to come with high interest rates. Kozak convinced them that this was a poor strategy, and he set about putting together something more reasonable.
The D’Antonios refinanced their mortgage several times, taking advantage of better rates on each occasion to lower house payments and gain some capital to put toward college expenses. They also got rid of all credit cards but one, which they used to purchase everything they needed and take advantage of cash-back opportunities. They paid the full balance every month.
Before, the family didn’t think much about purchases. Now they assessed every expense. They made hard decisions about what was necessary and what wasn’t—and it wasn’t a short-term program. Kozak convinced them that it could also be applied to their day-to-day lives and retirement planning.
Both D’Antonio kids graduated in four years from Catholic University in Washington, D.C. The couple had each taken out a small loan, so they’d have the impetus to succeed in the classroom and work hard to find jobs after graduation. Their son finished in 2018 with a degree in politics and communication, and their daughter majored in psychology. “We’re miraculously debt-free,” Ann says. “And we paid for our kids’ tuition in cash.”
Illustrations by Jon Krause
Check the Bottom Line
Parents interested in making sure the process of paying for college goes smoothly need to start early. But simply opening a 529 plan and throwing whatever money that can be spared into it on a semi-regular basis isn’t usually enough—or necessarily the right move, depending on your financial status. The best approach is a holistic strategy that includes smart financial planning, smart tax prep and a set of reasonable expectations for what is possible.
“The first question I ask is, ‘Do you have your house in order, in terms of debt, cash flow and earning potential,’” says David Kozak, founder and owner of Elite College Planning. He has been guiding families through the process for 10 years and understands that unlike retirement or other major life events, college usually comes with a hard and fast deadline.
“There’s a definitive timeline,” he says. “You know when your child gets to 18 years old, you’re going to have to put out a chunk of change.”
Kozak reminds families that there are many different vehicles available for financing college, aside from college savings accounts and loans, including whole life insurance policies and trusts.
“Plans have to be simple but sophisticated,” he says. “You need pivot capabilities.”
One of the main goals families should pursue is receiving as much aid as possible. That means sheltering money properly, avoiding large purchases like second homes that must be reported on aid forms and making sure they don’t deplete their retirement savings to pay for colleges.
Setting expectations is important, too. All parents want to give their children the best in life, but the idea of “the best” is not always universal. Still, that doesn’t mean a private college education is out of the question, it just means to choose “best” carefully. In fact, when it comes to the ability to provide aid, nonpublic institutions have an edge. “It’s possible for a private school to cost less than a public school,” says Judy Sciaky, founder of AP&G College Planning.
For instance, according to U.S. News & World Report, the full cost of Saint Joseph’s University is $63,630. However, the average student pays $38,459. That’s not cheap, but it’s a considerable deduction for students receiving need-based aid. That isn’t much more than the full cost at the University of Pittsburgh, which is $34,877 for the 2021-22 school year. Penn State’s main campus checks in at the same level.
Those who are looking to get financial aid should file their FAFSAs on the first day possible because schools have finite amounts of money to give away, and the earlier a family is in and qualified, the better chance of receiving some. And the amount a student receives is negotiable, particularly if they have offers from two or more universities. That’s important to remember, particularly for families whose students have done well in high school.
Sciaky also cautions parents that changes are coming in the FAFSA for the 2023-24 school year. There used to be discounts built in for families with multiple children in college at the same time. They will go away. It will be countered by an increase in income allowance. In other words, people who previously didn’t receive aid because they made too much money could be getting some, beginning in ’23. All of that makes tax planning vital. Because the federal return is the foundation of FAFSA, it’s important for people to shelter income and assets, the better to look more attractive to schools looking to give out money.
And for families to get that money.
RELATED: The Ultimate Guide to Colleges and Universities Around Delaware in 2022
Ivy Aspirations Met
Sue and Gary Hughes were doing everything they could to save for their son’s college payments. But there was one problem. “We’d put money away—but not at the Cornell University level,” Gary says.
In 2016, the the East Coventry, Pa., family realized that there was a chance that their son—a junior at Owen J. Roberts High School—would be accepted to the Ivy League institution, leaving the Hughes in a financial quandry. “Cornell was on the radar, but not guaranteed,” says Sue.
Until it was.
Their son was accepted to Cornell, where he studied environmental and sustainability sciences. Meanwhile, the Hughes family handled the monetary load in a responsible way that enabled them to pay for Eric’s four years without taking on massive debt or saddling him with ugly student loan payments. With help from Kozak, they maximized the amount of aid they received and knocked down their contributions to their son’s education. “Part of the plan was that we didn’t want to compromise our retirement to pay for college,” Gary says. “We had a two-pronged plan that put our money in places that were good for retirement but also optimized the money received for college.”
As a result, their son was able to realize his dream of graduating from Cornell— and the Hughes didn’t have to sacrifice their golden years.
Night Terrors
It was about 2 a.m., and SAS Becker was having one of those moments that has to be familiar to any parent facing the prospect of paying for college. Rather than engaging in some serious REM sleep, she was on her computer searching for ways that she and her husband, Rob, could get their two children through college without accruing the sort of debt that can cripple a family.
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Strategic Financing
Illustrations by Jon Krause
There have been plenty of reports about how much stress high school seniors feel when they’re putting together their applications for college. Are their grades good enough? Have they participated in enough extracurricular activities? And, oh, those essays.
It’s a hectic time, to be sure. But parents shouldn’t adopt the same deadline-oriented strategies as their offspring. It’s one thing for a child to be up late and scurrying to finish an application before the midnight deadline. It’s quite another for his or her parents to be in a similarly short-term mindset.
Though there’s plenty of planning to be done, it’s also vital to be aware and ready to adapt as conditions change. Those capable of flexibility will be the most successful.
Parents with children in grade school through the early stages of high school should make sure they’re paying close attention to the markets. Experts are almost universally united in the opinion that some form of correction is on its way. For those who have all their college savings in 529 plans, that could be big trouble. As anyone who dealt with the recession in 2007-2008 can remind you, things move quickly, and it’s possible to lose a huge chunk of savings if the money is all in the stock market. “When is the market going to do something unexpected?” poses David Kozak, founder and owner of Elite College Planning, part of the Chester County-based Paradigm Financial Group. “You never know when it’s going to happen or how big the correction is going to be. Think about it: If you have $100,000 in a 529 plan, and you don’t convert it to safe investments and you lose 40 percent in a recession, you’re in a tough spot.”
It all comes down to risk analysis. “We have this economy that’s going up and up and up, with greed and greed and greed,” Kozak says. “People are reinvesting their dividends and think this will go on forever. It won’t.”
It’s also important to have a strategy. Tax planning should make a family’s return more favorable for those calculating how much aid might be available. Diversification is also important. So is protecting assets earmarked for retirement.
But don’t forget that the child is the person spending four years attending school. Parents need to work together with their children to choose the best schools, where the children will thrive, grow—and graduate on time. That’s a big deal, because it can save tens of thousands of dollars. “College is a family affair,” says Judy Sciaky, founder of AP&G College Planning. “Kids have to understand that. Choosing the right college is critical. If they end up dropping out, it will be bad for the parents. It won’t be a five-figure mistake. It’s a six-figure mistake.”
So start planning. Even if your child is still toddling around the house, there’s a good chance college is in the future. The earlier you start and the more assiduous you are in their strategizing and saving, the better off you’ll be. “There’s a psychology that some people have that says, ‘If I ignore it, it will work out,’” Kozak says. “It doesn’t. If you don’t [plan properly], you find yourself in crisis mode, where you have to refinance your house, dip into your 401(k) or take out predatory loans.”
And that makes trying to write the perfect college essay seem like kid stuff.
Her search led her to Judy Sciaky, founder of AP&G College Planning. Little did the Beckers know how huge that moment would be for their family. Sciaky helped clarify the college financing process, and her common-sense strategies and advice have led to some overwhelmingly positive results for the Beckers.
Their daughter is currently a sophomore at McDaniel College in Maryland. Their son is a junior at Conestoga High School. The Beckers are handling their current and future college payment obligations without taking on a mountain of debt. They expect the same conditions to prevail when their son heads to college. And because they’ve learned so much, SAS has become something of a resource for friends. “A lot of people now come to me for consultations,” she says.
A high level of planning was key to the Beckers’ success. They aren’t exactly able to write a check that covers whatever fees a school requires. SAS is a self-employed photographer, and Rob is a seventh-grade science teacher in the West Chester School District. “When you’re a public school teacher and an artist, you’d better be looking at the bottom line,” says SAS.
The bottom line includes more than just the cost of college. That in mind, it’s crucial for families to clarify expectations with their undergraduate, so the proper choices are made.
After all, a four-year commitment could easily turn into six (or more) years of college down the drain—something that could cause plenty of sleepless nights for even the most financially equipped parents.