Here is my situation. In 2015, a relative died and we received about 200,000 as in inheritance. Last year my daughters grant from her school was reduced by about 5000. Parent income is about 150,000. My question is whether we should use the money that in an brokerage account and worth about 247000 right now to pay down house debt on a heloc in order to lower our efc. The school she attends is not a profile school but does have a supplemental faid form that asks what your monthly mortgage payment or rent is. If I took, lets say 50,000 to pay down the house would that make a substantial difference in what our efc would be due to our income and the fact that I still had 200,000 in reportable assets? Am I trying to finesse this for little to no gain? Thanks for your thoughts
I think if you only had the aid reduced by $5000 off a $200k asset, you’re doing well.
You can run it through a fafsa calculator both ways, with a $247k asset and a $197k (pay down $50k), but only the school can tell you if they care about that difference.
You might want to pay down the HELOC anyway. Is the money making more in the brokerage account than the interest on the HELOC?
Probably not, considering the $150k income and at least $197k remaining in reportable assets.
You have a $150,000 a year income. You have lots of reportable assets. Your kid’s school is not a Profile school…so unless it’s university of Chicago, it does not meet full need.
I suspect you are doing this financial gymnastics for no real gain.
the net price calculator on the website is really for incoming freshmen…but FYI…run it with the two different asset amounts. Does it show a difference in grant amount?
And rerun the calculator with the figures from her freshman year and see if it gives you the merit/aid she actually did receive. If the original numbers give you what you got, and last year’s numbers give you the $5000 reduction, you can hope that the new numbers (with the $50k as asset and the $50k as a reduction of house debt) will be close.
If the original number wasn’t right, then who knows how the school counts assets.
The only problem is…it is very possible that the NPC from last year has been adjusted to reflect THIS year. You might not get the same numbers because the school,has tweaked its formulas.