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Financial Aid

That Free Financial Aid Seminar May be Just a Worthless Sales Pitch

Mark Kantrowitz

November 18, 2011

From time to time I receive solicitations for free financial aid seminars that are really sales pitches for a product or service. I attend these seminars to monitor the information (and misinformation) that these seminars disseminate. The latest one was a bit different, in that it was affiliated with a

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national asset management and financial planning firm. It's not a very well-known firm, despite being publicly traded and managing a family of mutual funds, but nevertheless the company has a good reputation. The financial adviser running the seminar claimed to have more than 10 years experience with financial aid, and presented himself as an expert.

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But this free seminar did not differ much from previous seminars offered by less reputable firms. The solicitation letter was similar, headlined with a powerful hook:

Beat The High Cost Of College!
Discover How to Pay For College Without
Spending Your Life Savings...

The rest of the letter talked about "new secrets and strategies", increasing eligibility for college funding, avoiding the most common mistakes, picking colleges that give the best financial aid packages, and a list of various types of financial aid. That certainly would sound intriguing to parents of college-bound children. But the seminar itself fell far short of the mark. The quality of the information presented in the seminar was lousy, filled with errors and inaccuracies. The speaker was far from a real financial aid expert, and was unable to answer the few questions I asked to test his knowledge. An expert is an expert because of detailed factual knowledge of and insights into the subject matter, not because of an ability to state false information emphatically. When someone sprinkles "believe me" and "trust me" throughout a talk, that's perhaps a warning sign that the information is less than trustworthy. Unfortunately, the speaker was charismatic and convincing enough that the other parents attending the free seminar were likely lead astray by all the incorrect information, some of which was potentially harmful to their financial well-being. The speaker also disparaged college financial aid administrators and high school guidance counselors, saying that talking to them was "like asking the IRS for tax help." But financial aid administrators can provide the same or better information for free and with greater accuracy. The toll-free hotline operated by the Federal Student Aid Information Center, 1-800-4-FED-AID (1-800-433-3243), has a very good track record for providing accurate information concerning federal student aid and completing the Free Application for Federal Student Aid (FAFSA). I kept careful notes during the seminar, writing down every error verbatim. Hardly a minute or two went by without another significant error. Here's a list of three dozen of the more noteworthy errors, with each error followed by a corresponding correction.

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