Insider’s Guide: How to Pay for Therapeutic Boarding School (2017 UPDATE)

Before we dive into understanding the options for paying for a Therapeutic Boarding School, let’s quickly review what they are.

The Rise of Therapeutic Boarding Schools

Image result for boarding schoolAs public schools across the country have slowly been pruned back by state legislatures, funding for behavioral, emotional and academic support within schools have nearly dried up while public money is increasingly being used for private charter schools. Therefore, it’s not surprising private institutions that offer therapeutic (or quasi-therapeutic) environments like boarding schools and private schools have exploded. One of the fastest growing kinds of boarding schools is what’s called a Therapeutic Boarding School. Therapeutic boarding schools maintain the advantages of traditional boarding schools such as intimate class sizes, individual attention, great academics, developing student self-reliance, and the fun of living with peers in a completely “child-friendly” environment.

Some therapeutic boarding schools specialize in helping teens overcome certain psychological problems such as Attention Deficit Disorder, Bipolar, Asperger’s and even Depression. Others have programs for overcoming substance abuse problems or achieving weight loss. Some specialize in helping students who lack motivation get a fresh start in a nurturing environment. Most have some sort of family or parent involvement piece to ensure a team approach (ie. Weekly family therapy via phone or Skype).

While this all may sound great, there are definitely some risks and downsides (beyond the financial cost) of sending a kiddo off to therapeutic boarding school. I address those issues in great detail in another blog post. For now, let’s revisit the financial aspects…

Expense or Investment?

Parents often find themselves in a desperate situation with a troubled teenager. Their daughter runs away from home again, gets caught with the dealer down the street, crashes another car, and has yet another arrest. Parents become afraid for their teen’s lives as their teen’s risk-taking and lifestyle keeps becoming more extreme as the parents’ ability to set boundaries and expectations seemingly erodes.

It’s hard to think clearly and find solutions at times like this. Therapeutic boarding schools and therapeutic wilderness programs can provide answers, but they come at a price, with some programs running upwards of $50,000 a year.

But cost doesn’t have to be an insurmountable obstacle in getting your teen the help they need. We have helped countless parents in similar situations come up with creative ways to finance therapeutic boarding school, knowing that their child desperately needs an intervention. Therapeutic boarding schools are no longer exclusively the domain of the wealthy.

Top 10 Ways to Pay for Therapeutic Boarding School

Image result for therapeutic boarding school

Here are 10 ways families just like yours found to finance their teen’s therapeutic program:

1.   Hire a Consultant: Say what? More money? Yes, but trust me, this really will have super high ROI. Also referred to as case managers, therapeutic placement consultants or educational consultants, a good one is worth their weight in gold (a bad one is expensive and makes bad treatment recommendations). Make sure they are UNAFFILIATED with any program and have the clinical expertise to help advise and guide your family through the whole process. Some clinical educational consultants that specialize are able to handle this. A great case manager will be able to create a treatment plan, explain the process for getting a comprehensive psychological evaluation, walk with you through the intake process, support you while your teen is in the therapeutic boarding school, and coordinate discharge planning to ensure a seamless transition back to home or college. The last piece is essential – making sure your teen has everything they need to succeed after they return. Great case managers also know how to secure reimbursement from insurance providers for teens that attend therapeutic boarding schools. There are definitely some tricks (eg. Hire a case manager that’s also a licensed professional counselor and much of their work could be paid for by insurance) and inside knowledge necessary to make this happen.

Typical cost: $95 – 350/hr (some charge a flat fee of several thousand). 

2. Find the Program’s Financial Aid Officer: The private school or wilderness program should have a financial aid officer who can advise you about how to finance your child’s education. You should ask this person what programs, loans, discounts, or financial aid the school offers. Find out exactly what is included in the tuition and board bills, and if there are additional expenses such as buying uniforms or paying special fees for sports.

Typical Cost: Nothing – programs provide this to try to entice you into signing up. Beware of anything that sounds too good to be true – verify any claims they make about coverage from insurance, student grants/scholarships or loans. 

3.  Public School Funding: You may qualify for a loan through a kindergarten through 12th grade educational loan program. These loans work the same way as college loans, in that you pay what you can while your child is enrolled in the private school, and pay the rest off later. The terms of some loans let you spread out payments over 10 or 20 years. Your credit history will be a factor in securing a loan. Your school’s financial aid officer should be able to help you find such a loan.

Typical Cost: Your sanity – they will drive you crazy with the bureaucracy and take loads of time during your work day since everything in public school shuts down by 3:30pm. 

4.  Discounts for Upfront Payment: Some schools offer discounts if you pay by the year, instead of by the month. The average student stays at a therapeutic boarding school for less than two years, and wilderness programs are even shorter. A good therapeutic placement consultant/educational consultant will save you thousands of dollars by negotiating these discounts.

Typical Cost: More money upfront but no other associated costs. 

5. Tap 529: Consider using your child’s college fund first. Think of the therapeutic program as a way to get your child back on the right path toward college. Without intervention, she won’t have the grades or motivation to get through college and use her fund.

Typical Cost: Make sure there are no withdrawal penalties for use for therapeutic boarding school. 

6. Put it On Plastic: When you enroll your child in these therapeutic programs, there will be upfront expenses such as processing fees and deposits. Some parents borrow these initial payments from credit cards, especially ones that offer “frequent flier” miles. This way their child is immediately enrolled. They use their free mileage for transportation to and from the school.

Typical Cost: Beware of high interest rates if you don’t pay off your balance in full. 

7. Angel Investing: Some parents borrow the necessary funds from employers or relatives, and pay them back after securing educational loans or home equity loans.

Typical Cost: If you go through a peer-to-peer or crowdfunding site like The Lending Club or Kickstarter, count on a 5% fee for total amount funded. 

8. Health Insurance Reimbursement: Your health insurance policy may cover part of the cost of a therapeutic program as a medical expense. When you hire a case manager, they will be able to tell you how to file the paperwork and what you need from the program to ensure a speedy reimbursement.

Typical Cost: Sanity… totally lost if your insurer are jerks that don’t reimburse when and how they should. You are attempting to pull money from their cold, dead hands. Expect a fight.

9. Consult Your CPA: Some expenses for therapeutic schools and wilderness programs can be deducted from your income tax return as medical expenses. If you own your own business, you likely have WAY more creative options for deducting medical expenses.

Typical Cost: $200/hr for a good CPA to walk you through if and how to deduct from taxes.

10. Tap Home Equity: Parents have taken out second mortgages or home equity loans and then deducted their interest payments on their income tax returns.

Typical Cost: Fees, closing costs total 2-6%. It also bumps the timeframe for paying off that home back several years.

11. Public School Funding: We lied – there turns out to be 11 ways to pay for therapeutic boarding school. Is your child enrolled in public special education classes because of problems like attention deficit disorder and learning disabilities? Does your child have an “Individual Education Plan” at a public school? Do you suspect your child has learning problems that the public school cannot address? In certain cases, public school districts have to reimburse parents for private school tuitions. The Supreme Court ruled on June 22, 2009, that an Oregon school district had to reimburse a family for private school costs because the child in question could not achieve a free and appropriate education within the district. The child had not been enrolled in special education classes but was diagnosed later with attention deficit disorder.

When it comes to what matters most parents are unstoppable in finding ways to get the services and support they need. Don’t let cost be the determining factor. If your teen needs help, speak with a case manager, your trusted CPA as well as a therapeutic boarding school you’re considering and work together to find a way to get your teen back on track.

7 Personal Finance Tips for College Kids

Yup - More advice for college kids.

Yup – More advice for college kids.

Chapel Hill is once again overrun with the bustle of students back at UNC. Restaurants are packed and campus is vibrating with the nervous excitement that envelopes our small town each Fall. Unfortunately, not all students are prepared to take-on the privilege and responsibility of freedom only a college student can experience.  Here are 7 Personal Finance Tips we have used with other kids and their parents. 

1. Finish Your Education

The only thing more expensive than a life without a college degree is a life with a partial degree and student loans. If your college student is struggling at State Univ with a bazillion other kids, take the next semester break to meet with a career counselor or clinical education consultant to discuss what about Big U. is not working for your kid. Don’t dump another penny into education until it’s towards the most effective environment for their learning. 

2. Set a Budget
Sit down with the parents, figure out what they are willing to provide either monthly, semester or for the whole year. This is your ‘income’ essentially. Next, calculate all your Essentials or Needs (beer is not a need). Things like printer cartridges, meal plan or food money, gas money if your off campus, text books. Next, figure out your Wants (this IS beer money). Add your Needs and Wants – this is your estimate in expenses. Break it down per week since doing it by months does not fit well with semester length. If you have $100 per week for your entire budget and your parents do a great job of ignoring request for additional injections of cash, you will quickly learn how to use a budget. We encourage parents to not put a lump sum in an account everything month – it’s way too tempting to blow through that in a week. Instead, put it in weekly based on the budget you all came up with. Any adjustments should be made during semester breaks in person. 

3. Invest (… a little)
What you’re lacking in capital (ie. $$$) you can make up for in time. With very little money put aside either each month or year, you’ll be able to take advantage of compound interest – the most magical of money making secrets. Here’s an example:
Let’s say you took $1,000 invested it August 2014 in a mutual fund with an interest rate of 5% per year as you were heading of to NYU for Fall classes. Each subsequent year, you put in only $250. After you graduate you get a job – not your dream job, but something that covers your bills with a little extra. You continue to put in $250 per year and do this for another 6 years. The total amount you invested was $1000 + ($250 x 9 years) =  $3250. But the cray thing is, your money has been quietly making little money babies in your mutual fund and the total value is actually $4,930.59. Nice. That’s $1700 in income you made without lifting a finger. What another magic trick? Put no more money in EVER and when you are 59 years old, that same $3250 will be worth $24,023.96. Play around with this calculator to see more about what money does over time. 

4. Learn Finance Basics
This is a great time to learn the basics about taxes, expenses, budgets and cost of living. Waiting until you’re 29 years old, married with a child on the way is the wrong time to start learning. Take advantage of any finance classes available at your school. Ask to help your parents during March and April while they prepare for taxes. The absolute most hardcore way to learn personal finance from my perspective is to start a business. This pushes you to understand basics of cashflow, expenses, revenue vs profits, taxes, selling, marketing and negotiating – all skills totally transferable to most other life domains. 

5. Lock Up Your Money
If you are a student and have money of your own either from a job or money from parents – consider putting it aside till you graduate. How do you figure out what to put aside? This is where our fancy-schmancy budget comes in. Figure out your reasonable realistic expenses for a semester X 8 semesters = Four years of college expenses. Life below your means (ie. income) and invest in yourself through education, relationships and experiences. Ignore all the crap other students stuff their dorms and apartments with and focus on yourself, getting the most out of your four years with low responsibility and high freedom. 

6. Get a Credit Card
The old school wisdom was to never get a credit card. Ideally, that sounds great – pay for everything with cash. Reality is credit (FICA credit score, that is) matters and credit cards are a great way to start building a great score. We recommend getting a credit card with a ceiling or spending limit that gets paid off each month. If the credit card is only used for school purchases like books, computer stuff, etc. it makes tracking the expenses for deductions and tax purposes way easier. It also helps provided easy tracking for expenses as relating to your new budget. Finally, it allows parents to easily review and pay the card balance while also getting card points if parents are in fact covering the bill. How to find one that fits? Try out Nerdwallet for some reviews on cards that seem well suited for the responsible college student. 

7. Work (…a little)
If you are privileged enough to not have to work while you’re in school, it’s not a bad idea to pick up a small part time job (or start a side business – ideas include laundry pickup, tutoring, making t-shirts). This will help build your resume and put some money in your savings account you’ll be able to tap when you graduate. If you’re taken out student loans, you’ll have to start repaying them within a few months of graduating so having a bit of a cushion in the bank will help lower your anxiety if finding a job or getting into grad school is tricker than planned. 

Ok, hope this helps get you all excited and prepared for the Fall semester. Contact us if you have specific questions about personal finance or career counseling for your college kid. 

Treatment 101: Therapeutic Boarding Schools and Residential Treatment Centers

Today we examine some of the basic differences and similarities between therapeutic boarding schools and residential treatment centers (or programs).

 

THERAPEUTIC BOARDING SCHOOLS

Also known as Emotional Growth Boarding School (not used so much any more), is a boarding school based on the therapeutic community model that offers an educational program together with specialized structure and supervision for students with psychological, behavioral, substance abuse, or learning difficulties. Another newer term is Academy which lends some gravitas and impressions of legacy. Basically, it sounds fancier. 

In contrast with Residential Treatment Centers, which are more clinically focused and primarily provide Behavior therapy and treatment for adolescents with serious issues, the focus of a TBS is toward emotional and academic realignment involving clinical and academic oversight for physical, emotional, behavioral, family, social, intellectual and academic development. Therapeutic and educational approaches vary greatly; with the approaches best described as a combination of interventions often based on the founders’ perspective. The typical duration of student enrollment in a TBS range from one to two years with many schools mandating a minimum stay of at least 1 year. Students may receive either high school diplomas or credits for transfer to other secondary schools. Some therapeutic boarding schools hold educational accreditation within their respective states. TBS’s may be for-profit or non-profit entities and might also be owned by a much larger company (eg. Aspen Education Group, Red Cliff Ascent, Universal Health Services to name a few). 

Therapeutic boarding schools are generally middle schools and high schools that have comprehensive therapeutic interventions (medication management, individual/group counseling, life skills) for the students and a program to help them with self-esteem and problem behaviors. Some are more therapeutic than others while some boarding schools are actually therapeutic but will not list themselves in that category to avoid any negative connotation. 

Most of the therapeutic boarding schools do not have a medical plan for bipolar disorder, and do not provide psychiatrists on staff. If you want your child to attend a therapeutic boarding school he or she needs to be stable enough to attend school with therapy support (typically includes individual counseling 1-2x/wk, group counseling 1-2x/wk and 1 weekly phone conference with parents/therapist), while maintaining a relationship with an outside psychiatrist. Additionally, some schools do not wish to administer psychotropic meds. Ask the admissions folks if this is something important for you. 

 

RESIDENTIAL TREATMENT CENTERS

Sometimes the school that best meets the child’s needs just doesn’t exist anywhere near home, or the child may become too unstable to stay at home and attend school. It may become painfully obvious that a change in environment with a twenty-four-hour peer group and non-parental authority figures may help the child grow and mature in a safe environment. Maybe they are a danger to themselves or others and they need to be in a setting that can monitor their illness and behavior, as well as provide them with tools to understand and deal with their illness while not losing ground in school.

Residential Treatment Centers (RTCs) are medical facilities (most of the time). They should have psychiatrists and nurses on staff. They administer medications, make medication adjustments, and provide therapy and schooling. They are required to follow a student’s IEP.

Residential schools can cost anywhere from $56,000 to over $125,00 per year. A school district may pay part or most of the fee of such a placement, but typically only after a due process hearing. This process is not recommended for parents – Definitely bring in professional support for this (yes, a case manager or educational consultant with expertise in IEP/504 process and laws within your state). 

If you have not noticed the theme, here it is – Parents should ask for help from a clinical case manager or educational consultant. While the vetting and application may seem like an easy project for accomplished parents, the timing, financial and clinical complexities can create significant challenges. The case manager should have any professionals working with your child contribute to the discussion on placement strategies and options. Leave this to the professionals. It costs money on the front end but will save you thousands of dollars over months and years and also help you to understand your child, family and the education/psychological process much better. 

Here are some additional resources:

Program Tour: Pros and (Not Many) Cons of Edge Learning Community

Findings of a Summer Day Tour at Edge Learning and Collegiate Community in Chicago

Among the towering buildings and rattle of platformed trains in downtown Chicago is a vibrant support community for young adults called Edge Learning Community. I met with their Director of Business Development, Chris McClaughlin, on a toasty Summer day recently. He was kind enough to meet me in the downstairs lobby  – a modern but elegant entry convenient to one of the major stops for the Chicago Transit Authority (map here).  

Up we went to their expansive and deceptively large common area. Sleek, clean furniture juxtaposed the industrial feel of the exposed brick walls and weathered hardwood floors. This was just the beginning of an exceptional space and community.

To the left, Chris escorted me to their rooftop ‘backyard’ area complete with grass (actually astro turf), outdoor projector for movies, lounge chairs and hot tub. Sweet views of Chicago were the bonus. The space felt way more private than you would imagine. Despite giant glass and steel over shadowing the old building on multiple sides, one has a sense of serenity. Not a bad start to a tour.  

After talking about some of the history of the buildings and infamous Chicago characters, we cut through the inside common area out onto another patio on the West side. This was a super-call outdoor bar and grilling area which felt more like a bistro than therapeutic program. Chris pointed out the buildings where Al Capone had secret get-a-ways, we talked about the history of the city and then, after the late-morning sun started to cook us, we got around to talking about the program. It’s center around what they refer to as Core Competencies: Whole Brain Thinking (Rational & Irrational Thinking); Creativity and Continuous Learning; Effective Communication; Leading within Teams; Community Stewardship; Sustaining Healthy Relationships; Self Care; and Management of Resources and Technology. Rather than cutting and pasting from their site, I recommend going to their site to read through the details.

After lunch in the kitchen/dining room, we toured the rooms that, to be honest, felt way more like high-end apartments with large kitchens. High ceilings and plenty of space for single or multiple students make each room a great space for studying, hanging-out and even cooking. Chris and I spoke about the limitations of many programs that only accept young adults in recovery. Edge is well-prepared and works often with folks struggling with addiction but they don’t think of themselves as a substance abuse program. It is not for those in the very early stages of recovery. It is definitely not for those that do not have basic internal locus of control and responsibility for their behaviors. The heavy lifting of support for each resident is performed by coaches who, for all intents and purposes are therapists as shared with me by their clinical director Jason Wynkoop. They are highly trained and competent to work with young adults struggling with organization, recovery, mental health issues and behavioral support needs.

Our tour and day ended high above Chicago talking about Edge, it’s program and the bright future they have since so many older, more established programs are just not meeting the current needs of students today. To summarize, here are some Pros and Cons to consider. If you need more insight, contact us. We’re happy to share what we know to help you make the best decision.

Pros

Aesthetics: Fantastic common areas (no crappy This-End-Up blocky wood sofas that smell like dog). Mature, hip and nicely appointed apartments with great views . As a side-note, I had no idea This-End-Up was still in business until I researched the link for this review. Wow.

Location: If you are freaked out by silence, if you can’t stand wilderness, and if you prefer the hyper-rhythmic flow of the city, Edge is where you need to be, especially if you are in college and need support.  It’s close to huge parks, museums, great restaurants, entertainment and tons of public transportation. Cars are definitely not needed here.

Independence: For those needing collaborative but not overbearing support from super competent professionals, Edge is your place. There is an expectation you are in school and keeping busy during the day.

Cons

Model: It’s not a bad thing but if you are looking for a super traditional transition program this may not be for you (or your son or daughter). Their collaborative approach rocks for some but may feel overwhelming to those that just want a bed for their head.

Location: If the cacophony of big city life wears you down, this is not the program for you. Edge’s DNA is inseparably tied to the fast-paced hustle of 2.715 million neighbors. Fit is a big deal when looking for support during the already stressful (and fun) time of college and young adulthood.

To be honest, there just aren’t many Cons – nothing here is inherently bad. Quality, in this case, is clearly defined by fit. For those ready for the interdependence of young adulthood we highly recommend visiting Edge for one of their informational meetings/weekends, talking to alum and getting a tour before committing to Edge. Once you know it’s the right place for you, you’ll experience the intense, positive support of this fantastic, innovative community.

 

College Tuition and the Tax Implications

There is a little-known secret for parents planning to send their children to college in the future: Some of the tax-saving moves you make now could hurt your student’s chances for getting financial aid later. 

The way the financial aid system treats different assets could have a dramatic impact on how you save. Retirement plans and IRAs don’t count for college aid purposes. You’re not expected to break into these accounts to pay for tuition.

Key Points 

The college aid formula requires 20 percent of the assets in your child’s name to be used for college costs. But the government –mandated formula only expects about 5.6 percent of the money in the parent’s name to be spent. So you’re better off keeping accounts in your own name, especially during the last two years of high school, which is generally when you’ll be asked to start providing tax returns.

Don’t assume you’re not eligible for assistance. With the high cost of college today, many schools now have programs available to relatively well-off families if they meet certain qualifications. For example, your child might be able to get a “merit award” based on high standardized test scores and superior grades.

Best Strategy 

If you expect to apply for financial aid, don’t hold back placing money in your own retirement plan in order to put away savings in a college account in your child’s name.

Contributions to retirement accounts are usually tax-deductible and the earnings are tax deferred until withdrawn. On top of these tax breaks, your family may also become eligible for more financial aid.

TIP: If you own your own business and your tax professional endorses it, consider hiring your college-aged child and offering a company-wide benefit of college money. What you do for one employee you must do for all so definitely work closely with you tax pro on this one. 

Remember – You can usually tap retirement accounts for college money. Many 401(k) plans allow loans to be taken. And thanks to a tax law that went into effect in 1998, you can generally withdraw a limited amount from your IRAs penalty-free to pay higher education costs for yourself, your children and grandchildren.

Talk with your CPA or tax professional to develop a long term plan that’s right for your family, your retirement planning and your college-aged child.

Good luck.

Program Tour: Day 3-4 Oxbow Academy and Discovery Ranch

Here is the second of two part series of my visit to Redcliff Ascent and their sister programs in January 2013.

Day 3 – Oxbow Academy and Discovery Ranch

From Redcliff we went North East. Next was a long, weaving drive through mountain valleys towards  Oxbow Academy which specializes in working with adolescent boys with sexually-inappropriate behaviors. Their two campuses provide the ability to support kids with unique needs rather than having just one big facility. It’s a deeply clinical program with the feel of a safe home-away-from-home. Erin Nester, Admission Director, drove me between the programs so we could talk clinical details about the program. Basically, these folks know what they’re doing and clearly help families that feel hopeless.

After meeting with some extraordinary young men from around the world with the backdrop of snow-crusted mountains behind them, Steve and I slid out the icy driveway and continued our trek North towards Mapleton, UT where, on the sprawling campus of Discovery Ranch, I presented to all the Redcliff sister programs on working with affluent individuals and families. From the moment I went through the front gate to the final good-byes with staff – I felt I had experienced a truly thoroughly-designed and supported residential program. Every detail had been thought of to fully engage adolescents in realigning themselves.

Day 4 – Discovery Academy

I was not prepared for the detail the owners took to preserve the church they refurbished into a cutting-edge therapeutic boarding school. The staff at Discovery Academy maintain important history for the surrounding town while providing cutting-edge therapeutic academic support. The academic professionals, the clinicians, the administrators – all of them, they all show a level of personal commitment to the kids and program at large. The kids that go here are clearly good kids that need a bit of structure, a bit of nurturing, and a whole lot of encouragement to transcend unhealthy patterns.

Summary

I can not recommend any dining options anywhere near Redcliff programs for those of you that appreciate a good meal. Options between some of the programs often pitted us between awkward Chinese food restaurants and the snack aisle in the strangely empty WalMart. And please, do not ask for Starbucks or good coffee. If you can’t bring your own, start adapting to Earl Grey for your morning fix since you’ll either be drinking the brown hotel swill or hot black tar at one of the prolific truck stops. But let’s be real, you’re not looking at a Redcliff program because of the food or drink choices. You’re here because you’ve got a child or adolescent that’s been acting out and needs help. If you’re considering a Redcliff program, you’ll do a bit of traveling … but the investment of time, money and energy will be well worth it. Redcliff and all their programs are full of passionate, thoughtful staff with a full array of behavioral and academic services for teens and their families. They are not perfect and struggle with similar issues effecting other programs. The big difference is their curiosity and sincere interest in being a truly learning organization.

Here is the full list of Redcliff programs: Redcliff Ascent, Discovery Ranch, Discovery Academy, Medicine Wheel, Oxbow Academy, Discovery Connections

Spoiled College Kids = Bad Grades?

Here is a modified article on the surprising findings of a researcher who looked at the impact of wealth and college success. We also see these findings may be relevant to private school and boarding school.

Much discussion about higher education assumes that the children of wealthy parents have all the advantages, and they certainly have many. But a new study reveals an area where they may be at a disadvantage. The study found that the more money (in total and as a share of total college costs) that parents provide for higher education, the lower the grades their children earn.

The findings suggest that the students least likely to excel are those who receive essentially blank checks for college expenses.

The study — “More Is More or More Is Less?” — is by Laura Hamilton, an assistant professor in the School of Social Sciences, Humanities and Arts at the University of California at Merced, and was just published by the American Sociological Review (abstract available here), the flagship journal of the American Sociological Association.

Hamilton used data from three federal databases and compared parental contributions and grades. She argues in the paper that high wealth levels are associated with higher parental financial contributions, but also with other factors that contribute to academic performance (such as better high school educations, high aspirations for higher education, and so forth). Without controlling for socioeconomic status, those other factors may mask differences in patterns based solely on parental financial contributions.

And here she found — across all types of four-year institutions — the greater parental contributions were, the lower the student grades were.

This finding backs the idea that parental financial support can act as a “moral hazard” in that students make decisions about how seriously to take their studies without having personally made the investment of cash in their educations.

The impact of parental contributions on grades was lower (but still present) at highly competitive institutions. Generally the grades were lowest for students with high levels of support from their parents at private, out-of-state and more expensive colleges.

Before parents reading this article cancel those spring semester tuition checks and Facebook message their college-age kids to get jobs, there are two important caveats to the study.

One is that the study found a positive association (even controlling for other factors) between increased parental contributions and graduation over five years. In an interview, Hamilton said that she explained this finding (even if apparently contradictory with the results on grades) because those with minimal levels of parental support have a much more difficult job paying for college, and those who can’t pay, can’t graduate. “Kids who don’t have funds, they don’t stay,” she said.

The second caution Hamilton offered about parental spending on higher education comes out of the qualitative research project that prompted the quantitative work just published. Hamilton explored the impact of parental financial support on a women’s floor of a dormitory of a Midwestern public university, tracking student grades and interviewing parents. She found the pattern confirmed by her national data: many parents provided high levels of support only to be shocked (and, she said, angry) that their daughters weren’t earning good grades.

A second pattern Hamilton discovered in that study of one dormitory (and that she believes is the case nationally) is that the lowest grades were earned by children whose parents essentially supported them without much discussion of student responsibilities. The negative impact of high levels of parental financial support was mitigated or eliminated by parents who set clear expectations for their children about grades, graduating on time or other issues, she said. This extends to all levels of parental support for students.

The problem is that most parents who give a lot of money are apparently less than demanding about expectations. Then, Hamilton said, the students find college to be a great experience, and not one they are going to endanger by failing. “They say ‘I want to stay there, but I’m not going to work too hard while I’m here.’ They stay in college but dial down their academic effort.”

Hamilton stressed that she wasn’t arguing that parents who can afford to pay for college stop doing so. Rather, she said, they need to focus on what they are paying for, and to link their financial support to goals. What parents need to do, Hamilton said, is “to make smart investments.” That means evaluating the expense, and not just assuming that all spending during the college years has equal value. In other words, she said, a parent of means is wise to offer support so a child can take a meaningful but unpaid internship, but the parent isn’t going to see any payoff from providing cash for spring break vacations.

Read the whole article: http://www.insidehighered.com/news/2013/01/14/study-finds-increased-parental-support-college-results-lower-grades#ixzz2I3XElIRZ

Cheat Sheet from NATSAP Southeast Regional Conference Presentation

Below is the full, cranked-up cheat sheet from Rob Danzman’s presentation (Understanding and Working with Affluent Clients: Surprising Findings, Best Practices and Effective Strategies) given on October 18 at the NATSAP Southeast Regional Conference in Asheville. We added some juicy bonus information and links to spice it up a wee bit. Don’t hesitate to contact us with any questions.

Current Research and Findings

1. Substance Abuse

Children of wealthy parents tend to have higher rates of alcohol and marijuana use than their poorer counterparts.  Researchers believe this is due to multiple factors:

a. Money: Increased access to money without having to earn it or pay it back.

b. Supervision: Lack of adult supervision especially after school creates an environment of boredom and poor reinforcement of rules and boundaries.

c. Self-Medication: Increased use of substances to relieve anxiety and stress associated with achievement pressures.

2. Mental Health

Some of the major issues include entitlement, anxiety, depression, eating disorders (male/female are both at risk), and narcissism. Here’s where many of these issues originate:

a. Over-scheduled: They work hard on academics and generally feel over scheduled. There is significant pressure for achieving public success.

b. Only Children: They have fewer siblings and often were not raised with the need to share and have limits the way other children are.

c. Parental Critique: One of the most significant issues found in most of the research highlighted parental criticism. Having high standards is important for kids, but research showed that affluent parents will often push and push for greater and greater test scores, athletic success and social placement. Parents see a correlation between childhood success (grades, soccer, violin, etc.) with college success and, ultimately, career success. We could go one step further and say that the ultimate success parents are looking for is that of how the child contributes to the family’s legacy. Going to Harvard and becoming a respected attorney entrenches and builds the family’s prestige.  Unfortunately, this pressure overwhelms many kids and adult children.

3. Access

For many reasons, mental health and substance abuse services can often be easier to get for poor families due to a significant safety net system created by Medicaid, Medicare, HealthChoice as well as churches and local schools. Fonthill started out as a medicaid provider to families and, ironically, the same service we provided initially were not available to wealthier counterparts due to income limits. Poorer families can move up and down levels of care (outpatient up to hospitalization), get medication, therapy, family therapy, case management, etc. with little difficulty. The family see’s virtually no bills and no paperwork.

Another phenomenon is that, though in their financial best interest, many therapists report they do not like working with wealthier clients. There is a perception that a wealthy client does not appreciate the great life they have. This is addressed in further detail below.

4. Quality of Service

You would think that more money = more and better service. Not in mental health and substance abuse care. Many families’ first connection with services is through an outpatient therapist. Interesting research has found that a high percentage of therapists experience what is called schadenfreude – The enjoyment obtained from the troubles of others. If we were talking about not wanting to work with Black people or Chinese people, we would be branded as racists. Yet, when therapists make fun of or diminish the pain wealthy individuals feel, it’s socially acceptable. Pain is pain and it’s unprofessional and just bad business to ridicule those we serve.

There certainly are high quality programs with commendable outcomes but, as a percentage, wealthier families have a much harder time finding high quality service. One reason is the significant gap between services which, for their lower Socioeconomic Status (SES) counterparts, is less of an issue due to continuums of care being mandated in many states for Medicaid clients.

Best Practices

This refers to what clinical staff as well as non-clinical staff (and management) can do from a clinical or ‘quasi-clinical’ perspective to support and promote progress among affluent clients.

1. Structure

Affluent parents thrive in their professional life while their personal life comes undone. They want and need us to be directive and not waver from what we know is the effective approach to treatment and services. They want to know that your program or service is tight and runs seamlessly. Being firm, direct and clear with your expectations for the parents as well as the children is essential. It will actually relax them to know that you do not compromise or waver on any issue.

2. Curiosity

Express interest and concern for the individual (yes, the parents as well as the acting-out teen sitting in your admissions office). Many of us assume that these people are constantly being supported or, if not, they can easily ask for support or share their thoughts and feelings. Just not true. Ask open-ended questions, even during intake or admissions when your primary job is to get client information or give them instructions. These open-ended questions can go a long way. What has it been like for you Mr. Johnson to try and balance a successful business while also trying to keep your daughter sober?

3. Nurture

Parents often feel the need to create or perpetuate the myth that ‘everything is ok.’ Let them know you are listening loudly and everything is not ok, that’s why they are in your office or on the phone with you. What is ok is them trusting you. Trust has been in short supply in their lives. Let them know things are not ok and that, over the coming months with the team’s help, things will become more and more ok. “Seems like you’ve been caught between doing what is best for the whole family and not wanting your son to feel like you are singling him out. This must be an incredibly challenging time for you.”

4. Treatment Models

Fonthill recommends that professionals (clinical, support or management) use the following treatment models due to their evidence of the effectiveness.

a. Family Systems: Here are the 8 concepts Dr. Bowen discusses as influence within a family system – Triangles, Differentiation of Self, Nuclear Family Emotional System, Family Projection Process, Multigenerational Transmission Process, Emotional Cutoff, Sibling Position, Societal Emotional Process. Having staff do a basic in-service on this would catapult their understanding of why families act the way they do.

b. Cognitive Behavior Therapy: Developed by Dr. Beck, Cognitive Therapy (CT), or Cognitive Behavior Therapy (CBT), is a form of psychotherapy in which the therapist and the client work together as a team to identify and solve problems. Therapists use the Cognitive Model to help clients overcome their difficulties by changing their thinking, behavior, and emotional responses. Cognitive therapy has been found to be effective in more than 1000 outcome studies for a myriad of psychiatric disorders, including depression, anxiety disorders, eating disorders, and substance abuse, among others, and it is currently being tested for personality disorders.

c. Dialectical Behavior Therapy: Dialectical Behavior Therapy (DBT) is a treatment designed specifically for individuals with self-harm behaviors, such as self-cutting, suicide thoughts, urges to suicide, and suicide attempts. Many clients with these behaviors meet criteria for a disorder called borderline personality disorder (BPD). Recent research shows that DBT is also effective in treating substance abuse, depression, anxiety and numerous other issues. DBT is  great for staff to use in their professional as well as personal lives. DBT is more like an instruction manual for life rather than a cold, scripted way to solve or process a problem.

Effective Strategies

Professionals and programs are not just made up of clinical programming and require some tailored approaches that come from the world of consumer psychology and marketing specifically regarding the affluent community. Ignore the following section at your own peril.

1. Identify the Boss

This may not be the parents calling on the phone or sitting in your office. Sometimes, grandparents have the power, write the checks and have veto power over what services are allowed. Sometimes there is a Special Needs Trust with several trustees that must sign-off on everything. Get curious about ALL of the stakeholders in the family. Fontill staff do this within the first few meetings/sessions/contact in the form of a genogram (family tree).

2. Target Wants vs. Needs

What you about to read is heretical within therapeutic circles. It disrupts the stogy, dusty, old philosophy that mental, behavioral health and substance abuse interventions should be treatment-focused and marketed on their interventions and outcomes. Fair enough. But we live in an age when we know more about how people make decisions and the rules for how to communicate about products and services are being constantly rewritten one industry at a time. Enough of ranting, let’s get you some solid advice…

Most programs target and sell their services to needs of the families (ie. Length of program, therapy sessions, what type of evidence-based model is used) instead of speaking to their wants (ie. Hope, safety, progress, return on investment). Seems counterintuitive but these parents can’t be expected to really tell the difference between all the great (and not so great) programs. They look the same on the websites, brochures and even on site. The main difference can come when program staff speak on an emotional level to families – connect at their core rather than rattling off program features – tell how the program features eleviate pain, fear, and instill hope and change and investment in the families’ future.

Staff should learn about the lifestyles of wealthy families (ie. Visit lateral websites like BMW, PelligrinoCoachWhole FoodsUmstead Hotel). Each of these examples is selling a promise of what you will experience and feeling when you buy their stuff.

3. Customer vs. Client

Families would prefer to be treated like valued customers rather than parents of clients. They want to be informed, but they also want to be treated like the substantial amount of money they are paying you grants them exclusive, members-only access. You and your staff are consultants, concierges and customer service reps rather than LCSWs, LPCs, and LCASs. Differentiate between clinical info and customer service. This ties nicely into our little piece above about speaking to their wants more than to their needs. 

4. Use Better Language

Use correct, effective, and positive terminology. Here are some sample word make-overs

Investment  vs. Cost

Exclusive  vs.  Availability

Concierge Service  vs. Instructions

Orchestrated  vs. Planned

Artisan  vs.  High Quality

Summary

Want More Detailed Information? There is much more we could cover but this list should get you and your staff headed in the right direction. For a comprehensive list of most of the research published over the last 20 years, contact us here and ask for Affluent Studies Research List. We’ll send you a PDF of what we’ve got. 

Want Your Staff Trained? For more information on working with the unique needs of affluent families, contact us here and ask for more information about having Rob Danzman come and speak or train your staff. He is available for half and whole day staff training and management consultation to make sure that your resources are used in the most effective ways.