It’s no secret that a niche is an important tool in the hands of a successful business owner. But finding, crafting, and honing that niche isn’t a small task. Many advisors struggle with searching for and catering to their ideal client, and by not doing so, leave thousands of dollars on the table each year.
What if I told you that there is a niche so many advisors overlook but when implemented correctly can generate a wave of business for years to come?
Are you hooked yet?
One of the most profitable and important niches in our profession is college planning. Let’s take a closer look at how this niche operates and the many ways it can change the way you work with clients.
College planners are in high demand
Higher-education is one of the most expensive endeavors for students and their families. Tuition costs have continued to rise and for the 2019-2020 school year have raised anywhere from 3-4% for both private and public schools.
These increases can rack up a hefty bill, averaging about $100,000 for an in-state public 4-year university. These sticker prices fluctuate depending on several factors:
- Public vs private
- In-state vs out of state
- Community college vs University
But the costs don’t stop there. On top of tuition and fees, students need to pay for room and board, books, and other school supplies which don’t come cheap, leaving many parents and students alike stressed about how to plan for such a major expense.
A recent Discover student loan survey found that 65% of parents are worried about the increasing cost of college. Interestingly enough, 70% also said that they would not limit their child’s choice by the price tag.
The data gives us the opportunity to look at college in an interesting way. Even though the cost of tuition is rising and education becomes much more difficult to plan and save for, many families still see it as a priority for their children.
With strong guidance and advice, these parents will be able to come up with a financial plan that supports college planning. That is where you can come in and help.
College-bound families are an underserved market
Despite enrollment decreasing over the last few years, the National Center for Education Statistics predicts undergraduate enrollment to increase 3% to 17.2 million students by 2028.
And as we have previously noted, college funding is of massive importance to families, so why has the financial industry historically overlooked this teeming market? Because so many advisors miss the true value that comes from solid, ongoing college planning services, leaving a hole in the market.
Think of a college planning niche in terms of the Blue Ocean strategy. This strategy is all about tapping into new markets to create demand as opposed to fighting for demand. Created by Chan Kim & Renée Mauborgne, the Blue Ocean strategy operates by defining and redefining market spaces. They coined the terms ’red ocean’ and ‘blue ocean’ to describe the market world.
Let’s put this idea in context.
There are so many wealth management and retirement planning advisors out there who have to compete for the same market. This fierce competition becomes a red ocean, a saturated market with more advisors than clients.
On the other hand, a blue ocean offers the potential for untapped market space. One where the rules and industries aren’t defined and are open to possibilities. This allows for the opportunity to generate demand and create it organically. In this context, college planning is like a blue ocean. It is an arena overlooked by many advisors and can provide a clear path for industry success.
Market mini case-study
In order to demonstrate the vastness of this market, you will need to start with a few bits of research in your area including:
- Market analysis of school districts
- Average household income
- Percentage of students who plan on attending college
- Colleges, Universities, and other advanced schooling programs in the area
- The average cost for education in your state/area
For our sample today, let’s look at Dublin, OH.
There are over 20,000 kids in high school within 10 miles. The area boasts 5,000 graduates per year with 90% of those graduates (4,500) going directly on to college. That makes 5,000 new college freshmen each year.
This is a market hungry and ready for seasoned and passionate advisors to help them save properly for their kid’s education. It’s time that the financial planning community took this market seriously and worked tirelessly to serve this market in need.
With college planning, advisors are constantly renewing the market with a deadline and a benefit for taking action. Other than filing taxes each year, and making your social security or pension elections, this is one of the only times people have to take action.
Is college planning a good fit for your firm?
College planning is an excellent niche to either pursue on your own or add to your firm. With so many parents and students struggling to find proper advice, you will be able to develop meaningful relationships while also maintain a steady influx of clients from year to year.
Part of offering incredible service is having the proper tools and resources to do so and here at College Aid Pro, we have you covered. Our software is designed to empower advisors for success in college planning from processes to models to sorting tools to a community and more, we have what you need to build a successful college planning practice.
Interested in trying it out for yourself? Sign up for our free demo.