Don’t be fooled by a Financial Planner
The Dave Ramsey Show
A few years ago, my wife became a huge fan of The Dave Ramsey Show. Her love for the show has since abated, but it was her top podcast for a while. I would routinely arrive home after work to find her listening to the show while cooking dinner. I couldn’t help but listen myself and, admittedly, I did find some of people’s financial mishaps quite amusing. More so, I enjoyed hearing people’s stories of how they were able to dig themselves out of a hole and rejoice with the “We’re debt free!” scream.
You can’t listen to Dave Ramsey without hearing about Financial Peace University and the 7 Baby Steps, of which Step 5 is saving for your children’s college education. I had two kids at the time with a third on the way and knew it would be a good idea to start saving.
College Savings Plans
Dave was always talking about college savings plans and 529s. I had no idea what that meant but was under the impression I needed a Certified Financial Planner (CFP) to open an account. This was because Dave was always advocating for working with a CFP having his stamp of approval (now called a Ramsey SmartVestor, I believe). I did some Googling to find a SmartVestor in close proximity but didn’t have much luck. As it goes, I forgot about the whole thing and went on with life.
Every few weeks or so I would be reminded of my need to start saving for college, but I always felt discouraged because 1) there weren’t any Ramsey certified CFPs around and 2) I didn’t feel comfortable working with a CFP I didn’t know personally.
Certified Financial Planner
Fast forward a couple years and my family had moved to the Cincinnati area and we now had three kids, all for which I had not saved a dime for college. Fortunately, we had some luck finding a Ramsey SmartVestor in the area and I set up an appointment. My wife and I met with the CFP on two separate occasions. He was a nice enough guy. We discussed college savings plans, financial goals, budgeting, and all the like.
Of course, I was most interested in college savings, but he tried to sell me on many other services. I steered the conversation toward 529s where he mentioned a few options, referring specifically to states such as Ohio and Wisconsin. In my naivety, I had no idea college savings plans were state sponsored.
Open A College Savings Plan In 10 Minutes
After my second visit with the CFP, I had completed all the forms necessary and planned on starting a financial relationship with this individual. He was only charging a “minor” fee after all. Prior to my sending in the paperwork, I decided to Google “ohio college savings plan 529”. The search led me here.
Light bulb moment. What I learned very quickly is you don’t need a CFP to open a college savings account. My CFP (almost) never once mentioned this. I suppose it was the old bait & switch, but I simply did not know.
So thus, in lays the moral of this story, you can open up a college savings account(s) yourself and start saving, literally today. Don’t be fooled in believing you need a “professional” to do it for you.
P.S. This post isn’t intended to be a knock on CFPs. Perhaps the one I had dealings with was simply not a forthright individual. However, parents simply do not need to pay a CFP to open or manage a college savings account. College savings plans are simple, straightforward selections based on your risk tolerance and the age of your children. No special skill necessary. Save a buck and do it yourself.
