<p>You have to declare it as an asset because you have the money now - it’s available for your child’s college costs. Even if they hadn’t set up a 529, you would have inherited the money and still would have that asset. </p>
<p>Unless you’re low income, this asset may not matter that much. Typically, once you earn enough not to qualify for “free money,” your aid is really just student loans - which you may not have wanted anyway. </p>
<p>If you didn’t have this asset, would you qualify for “free money” (Pell, etc). Your income would have to be rather low.</p>
<p>We were in a somewhat similar situation when I inherited some money. Even without the inheritance, we wouldn’t have qualified for any “real aid” (I don’t consider “loans” as “real aid.”) Yes, if my uncle hadn’t died, he would have had the money, and I wouldn’t have had to declare it. But, he died, left me some money, and now it was in my hands. </p>
<p>Have you tried using an EFC calculator to determine what difference this asset makes? You could first try the calculator with the asset, and then do it without the asset. <a href=“http://www.finaid.org/calculators/finaidestimate.phtml[/url]”>http://www.finaid.org/calculators/finaidestimate.phtml</a></p>