<p>Santookie… you resurrect a year old thread :). Good, as I have companion. My DD will go to Berkeley as well. We have the very similar FA situation. You are right. The MCAP grant do affect the Fed Sub loan. But grant is free money though! We don’t have work-study as well, and was told we can replace the Sub loan by work-study, but not sure if you can get more than the Sub loan amount. The total income used to calculate the MCAP grant included the 401k contribution, which is very unfortunate.</p>
<p>I am looking into private loan as well. Looks like Discover has a better rate. Mind share your private loan preference?</p>
<p>CalDad2013… share the worries! When my D graduate, my S will be entering college. Lower middle class (are we?) is tough. The MCAP is a blessing, or isn’t. I don’t know. </p>
<p>What do you mean by “still waiting for real numbers”? Is the MCAP amount on the MyFinAid real?</p>
<p>I’m sorry in advance if I beat a dead horse and resurrected this.</p>
<p>MY other suggestion for people without subsidized loans is to look into sofi.com. I heard about it on NPR went over and jumped on the waiting list. It’s an amazing idea. Check it out.</p>
<p>Yeah free money. My current plan at this time is to go bare on everything finance wise. Take out a $10k loan against my 401k every 10 months and pay it back. Cycle it every year then borrow the extra I need less the extra I save. Too bad lots of loan places want to knwo the amount you want for all four years. But 6% isn’t too too bad.</p>
<p>Regarding the MCAP at Berkeley, it does create a discontinuity in the estimated financial aid in the net price calculator at around a family income of $140,000. Not that surprising, but parents whose income is close to that discontinuity may want to consider how they time income in tax years when that is discretionary (e.g. realization of capital gains and losses in one tax year versus a different tax year).</p>
<p>ucb, we’ve been wondering about that. My spouse is transitioning from teacher to principle and income will go up. Sigh thinking how this will affect things and should we contribute more to our retire etc pretax. It’s all so complicated! Feel like I need and accountant just to figure out best way to handle finaid.</p>
<p>The higher the income (<140K), the more parent need to pay (under MCAP). In turn, may have less MCAP grant. Since MCAP grant is considered as student’s need, less MCAP money means possible more Fed Sub and Unsub loans. Will it compensate each other? I don’t know. Of course, one is free money, another is loan.</p>
<p>Putting the extra income in 401K and borrow it out… not sure if it is worth to do so.
Berkeley has a defer payment plan, maybe u can use the extra $ to pay the fee each month. </p>
<p>It is so complicated !</p>
<p>“What do you mean by “still waiting for real numbers”? Is the MCAP amount on the MyFinAid real?”</p>
<p>I mean since our FAFSA wasn’t submitted yet, the finaid numbers have been estimates. Still trying to get a handle on exactly what this will all cost. I think we’re pretty close to understanding though. No UC SHIP health insurance, no personal money (except what he earns through part time work), no transpo money, cheapest dorm housing (triple room)…just tuition/fees, books, housing/meals. Estimating $22-23K/year, in-state resident.</p>
<p>MCAP grant was $3,194. AGI = $127K, two younger kids, both in public school. Better than a poke in the eye with a sharp stick.</p>
<p>Caldad yes we basically came to the same conclusion. Straigh costs of about $13k tuition and triple in dorm for $12k so $25k less $5k grant. So we have to come up with $20k sounds more reasonable and closer to if he went anywhere else.</p>
<p>My plan to cut cost is to ask my D to move out to rental after freshmen year. I was told that it will save at least 1/3 of the cost (a 2 bedrooms apartment/house for 4). Also the meal plan and book cost are quoted higher than reality. Try to save every pennies as my younger son will be on board in 2017.</p>
<p>We are all in the same boat 
.</p>
<p>dad4life - That is exactly what my brother in law said. He graduated last summer. Rent for him was about $600 he shared a room, it was about 2-3 blocks from school. But I remember going to one of his apartments, omg it felt like a crack den! The hall had bad lighting going to the door etc. I’m sure book costs could be cheaper for the avid internet shopper and meals could be parred down a bit. I’m planning to take a loan against my 401k every 10 months at the bond rate of 1.5%. I did look into sofi.com but no reply from waiting list. So we’ll see.</p>
<p>Take a brief look at sofi.com, interesting! The new rate is not up yet, but the FAQ said for 5 year loan term, it was 5.74% APR. My 401k current loan rate is 5.25%. </p>
<p>What is the 1.5% bond rate for? Are you saying you get 1.5% rate from your 401K loan?</p>
<p>dad4life - I’m actually a federal government employee. We have our own version of a 401k called the Thrift Savings Plan. For us we can make one misc loan at any time, involves a $40 dollar fee and the interest rate is whatever the current G Fund rate, ie gov bond rate is for the indexed year. Basically I’m paying myself back into my 401k at the lowest rate. Therefore skipping any withdrawal penalty etc. Yups our rate is really low. If you borrow are you paying yourself back at 5.25%? Or is that interest going to the bank or something?</p>
<p>The one thing I did not like about sofi.com was that you had to borrow the lumpsum for all four years at once and pay interest on it. I think the mentorship etc is fantastic.</p>
<p>santookie… Wow! I’m jealous ! That’s the best choice. I don’t think you need to consider other loans. My employer’s 401k plan is 5.25%, it is based on the PRIME rate. So it may change (goes up most likely). Anyway, it is still an option to borrow it and pay back in 1 year period. Still need to figure it out the actual monthly payment. All my payments will go back to my 401k account post-tax .
Yes, a lumpsum for 4 years is not attractive at all. Doesn’t make sense to pay the interests for yet-to-use money.</p>