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words by > David Geffner

During his 30-year career in sales and marketing, Paul Celuch socked away much more than the $170,000 it cost to put his two sons, now 34 and 27 years old, through private colleges. Yet today, he tells parents he could have saved himself almost half his costs had he approached college admissions the way he once cut deals at IBM or MCI. “You don’t enter into long-term debt for your home without serious negotiation,” Celuch says. “Why should higher education be diff erent?”

Why indeed? Two years ago, the former telecom executive had an epiphany that led to the formation of College Assistance Plus (CAPlus), a Rochester, NY-based consulting firm that helps high school students find the right college at the right price. Celuch, a deacon in his local church, was counseling parishioners in money management when the light went on. “Th e people I saw were being trampled by college debt,” he recalls, “so I sat down with a partner to create a business model that, more than anything else, was geared to helping these local families out.”

GOLDEN RULES FOR YOUR HIGHER EDUCATION

1. Start saving money early to give your family the best chance of meeting rising college fees.
2. Be skeptical about the facts colleges use to market their institutions. Celuch says that teacher-faculty ratios are “misleading,” due to the large number of teaching assistants working off loans at many universities. Determinations of a family’s expected contribution (necessary for receiving financial aid) are often unrealistic and lower than required.
3. Use loans as your last resort. According to CAPlus, 52% of every dollar borrowed for college ends up paying for college, and the rest is for personal purchases. Celuch tells parents not to be afraid to stop their kids from making a bad long-term financial decision.
4. Don’t buy conventional wisdom that the more storied a school’s reputation, the better the career. “My clients are surprised when I tell them that over the last 10 years the school graduating the most CEOs has been the University of Wisconsin,” says Celuch.
5. Buy, don’t rent. The auto industry saw a large spike in retail prices when more consumers began to lease; likewise, says Celuch, college fees will keep going up as long as people keep borrowing money to pay for colleges they can’t afford.

Celuch and co-founder Phillip James invested $250,000 in personal funds to build a database covering 2,500 public and private colleges in the US and Canada. Th ey purchased information from sources like the Department of Education, Barron’s and College Board, and rechecked the data with admissions personnel. Th ey kept their fees reasonable—a one-time charge ranging from $1,300 to $1,800 covers the student all the way through graduation—and set about guiding families through college financing options, including Expected Family Contribution, gift s from family members, a student’s personal assets, and federal and private aid.

Rather than chasing aft er the most highly selective schools, CAPlus seeks out lower-cost alternatives, schools eager to compete for their clients. Prime targets include schools wanting out-of-state students, looking to raise their own SAT/ACT averages, or off ering grants and scholarships to help fill deficit enrollment in major fields of study. Negotiating with universities to improve a student’s financial aid package (even aft er the aid has already been determined) is another key strategy.

If this all sounds a lot like buying a car, pitting dealers against each other for business, that’s exactly the intention. Celuch says colleges market to ego and emotion, just like Lexus or Acura. Th ey set fees in line with their competition and not by the financial means of their customers. “But unlike cars or real estate,” Celuch notes, “there’s no downward pricing pressure on universities. Since 1976, fees, on average, have risen almost 300%—while entry-level salaries for college graduates have remained flat, at roughly $46,000. We’re not trying to devalue a college education; we’re just trying to put it into financial perspective, like any other large consumer purchase.”

CAPlus is hardly the only company guiding students through the jungle of college financing: CPAs, financial services professionals and a slew of online firms all now off er loan and planning information in what has become a mini-industry. But few combine the tactical corporate experience with the hands-on social consciousness of a non-profit, like CAPlus. Th eir approach dispels the notion that college loans are cheaper than other forms of consumer debt (federally-funded loans are not dischargeable through bankruptcy), and it has worked.

In its first year, 2004, CAPlus, an LLC, had $60,000 in sales; by the end of 2006, they had increased revenues by 350%, pushing their client base past 500. They find their clients via radio spots, seminars in continuing education programs, and “lunch-and-learns” with various corporations.

Given that Celuch and James are on the back-end of long and successful careers, selling out to the highest bidder is not on their radar screens. Th e pair turned down a seven-figure investment off er from Kentucky-based Papa John’s Pizza. “In December of 2005, we spent another $75,000 to set up franchises in 30 states,” Celuch describes. “Franchisees pay $30,000 to buy an exclusive territory and act as our sales representative. Th e database is proprietary, so we do all the back-end office and search work here in Rochester.” While franchisees are free to work out of their homes, with no employees or accounts receivable (clients pay up-front), Celuch insists the business is not for everyone. “Th e CAPlus model is for people who want to make a decent six-figure income and help families,” he says. “It’s never going to net a billion dollars and go through the roof.”

Th e small-is-better philosophy has appealed to parents. Rich Bannister says his $2,500 investment with CAPlus (for daughter, Katie, and son, Brian) was a “no-lose proposition.” Celuch reduced Katie’s tuition at Syracuse University by $8,000, even though Bannister, who owns a consulting firm specializing in employee benefits, makes a high six-figure income. “I never would have dreamed of negotiating for college until I hired Paul,” Bannister says. “But what he does makes sense. Th ese days, colleges are run like big corporations, and you need an expert who can save you time and frustration.”

Patty McNamara, 46, is a widowed mother who heard about CAPlus through a presentation at her daughter’s Rochester-area high school. Th e government employee wasn’t even sure if she could pay for college, given her fixed income and lack of savings. Aft er doing all the legwork and selection research, McNamara signed up with CAPlus. Th ree out of the four private schools that catered to her daughter’s interest in forensic science sent them letters of acceptance. “All three schools have put forth financial aid packages, and I felt ill-equipped to negotiate,” McNamara relates. “I would prefer not to bankrupt my future paying for college, and I wanted someone to hold our hand through this process. Hiring Paul buys me that peace of mind.”

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