How does this author and financial strategist inspire readers to leverage an abundance mindset to improve the college financial planning and education legacy planning process for families?
This article features an interview with Doug Andrew, Author of the recently released “Entitlement Abolition” book and founder of Live Abundant, a company that educates on topics of health, wealth, and life fulfillment. Based in Salt Lake City, Utah, Doug Andrew focuses on helping families to make healthy financial decisions through his publications, webinars and presentations. Prior to “Entitlement Abolition”, he has written several books including “Missed Fortune 101”, “Millionaire by Thirty”, “Missed Fortune” and New York Times best-selling and Wall Street Journal #1 book of “Last Chance Millionaire.” Together, the books are referred to as the “Missed Fortune” book series and seeks to help families refocus from consumerism to rebuilding one’s health, wealth and wisdom through focusing on family, financial planning and continuous education. You can learn more about Doug and his new book at http://dougandrew.com/. Last but not least, thank you Doug for your time, insight and support in working with me on the article. Please read the question and answers to learn about his perspective on college financial planning and legacy planning, and hope that the article provides you with an opportunity to learn more from your peers.
Question 1 (Paul Curley, Editor of the 529 Dash): How and why did you first get started in helping clients with financial planning?
Answer 1 (Doug Andrew, Author of “Entitlement Abolition” and Financial Strategist): I entered college with the intent to become an estate planning attorney. I studied and obtained a Series 1 Securities license and an Insurance license as a means to pay for my own college education (which I did). By the time I was in my senior year, I was earning a six-figure annual income on a part-time basis. The more I interviewed attorneys, the more I realized that most shared with me that if they had to do it over again, they would have gone into the financial planning arena rather than the legal arena. So I stayed where I was and my career has been extremely rewarding as I serve others with dynamic financial strategies to optimize assets, minimize taxes and empower their “authentic wealth.”
Question 2: Student loan debt has been climbing on a year-over-year basis, while the US personal savings rate is at its lowest point in almost ten years. How can families incorporate more responsibility, accountability and ownership into their college financial planning decision-making process?
Answer 2: Even five year olds can learn that they're expected to work hard to pay for their college education. When your children pay for their own education, even by earning academic, athletic or leadership scholarships, the education means much more. It’s something they’re investing in, not something they deserve or is owed to them. The accountability is powerful and they attend classes regularly and study. They see the value of the education and strive to reach their individual education and career goals.
We never left our kids completely on their own, however, as long as they did their part. If you have the resources, as we did, I believe in matching what they save for college or have earned through scholarships, or even serving as their bank, with established requirements that include flexibility for unplanned events that might slow the repayment process. My daughter Ashley took advantage of our matching funds when planning her college study abroad to Israel and Egypt. She enjoyed that experience so much that she sold her car to help pay for another study abroad to New Zealand, and asked us for a small loan to pay the remainder. As promised, she repaid it within five months of returning. Even better, rather than just asking for Mom and Dad’s money, she developed the strategy, proposed the solution, and fulfilled the very obligations she designed. That's responsibility, accountability and ownership.
Question 3: Why is entitlement important when leaving a legacy, and how can high net worth (HNW) parents keep entitlement in mind when creating a college financial plan?
Answer 3: You aren't doing your children any favors by paying for everything they want or need, from buying a home or car to paying for college, even if you can. Children, especially those growing up with HNW parents, need to put their own skin in the game, rather than getting something for nothing. We need to capture and leave behind the “how to fish” legacy for our children and grandchildren, not just “dumping” fish in their lap. Otherwise, they risk becoming entitled, or what I call co-dependent BRATS (Blamers Running from Accountability and Truth).
Question 4: How can the abundance mindset improve the college financial planning process?
Answer 4: Abundant-minded people believe their greatest future will be best achieved by collaborating with others—it’s not about them, it’s about others. Abundant-minded people are:
• Motivated to learn and change
• Independent thinkers
• Decisive in nature
• Responsible and accountable
• Financially disciplined
• Courteous and respectful
Hence, college students with these mindsets don’t expect hand-outs nor do they graduate with the attitude that the world owes them a living.
Question 5: How can 529 product partners and state agencies better support you in your role as financial strategist?
Answer 5: They can help the parents of college student understand that there are many resources and ways to prepare for funding higher education by saving on a tax-favored basis. If the student understands that they need to have some “skin in the game,” then scholarships, grants and loans and/or their parents can assist with a “hand-up”—not a “hand-out."
Question 6: Do you have any suggestions on how families can leave behind a lasting legacy that matters?
Answer 6: In my family, we've actually created a Legacy Bank, which is a conceptual bank where you can deposit the knowledge, experiences, strategies, and lessons learned by family members. As I wrote in my book Entitlement Abolition, having a functional Legacy Bank in place—with the family actively participating in, contributing to and withdrawing from the bank—empowers future generations to have early access to moving forward in developing their own KASH (Knowledge, Attitudes, Skills and Habits) and cash!
Editor’s Final Note: Thank you Doug Andrew for your time and insight in the article, and much appreciated. Also, I would like to provide a special thank you to the readers of the article for learning from your peers, for your support and your engagement. Have the college financial planning and education legacy planning discussion with your clients today.