<p>Its my first year in college and I've been on financial aid. I recently got a part time job and I make about $120 a week working about 22 hours a week. I have about $500 in the bank and I was wondering if this makes me no longer able to get financial aid. My dad is telling me that I won't be able to get aid if I have money in the bank and that I should withdraw the money and keep it all as cash. How much money can I keep in the bank so that I can still get financial aid? thanks in advance!!</p>
<p>If you are under 24 and not married (and have not served in the army and don’t have kids) much of your aid eligibility will depend on how much your parents make and what their assets are.</p>
<p>That being said having $500 in your checking account will not affect your aid.</p>
<p>$500 will affect your aid, but minimally. If you want to avoid that, then right before you file FAFSA, withdraw the money and spend it on something that you’d have to buy anyway…new tires for your car, whatever.</p>
<p>How much will you earn annually? As long as it’s less than $6000, then you’re ok with that, too.</p>
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<p>Cash needs to be reported as well. That will add 120 to your EFC which is extremely minimal. You’re no going to lose more than $500 in aid because of that unless you were on the extreme edge of not qualifying for need-based aid.</p>
<p>Just time your filing of FAFSA right after you’ve spent the money on some needed thing. Problem solved. Certainly, between now and the next time you file FAFSA some large expense will come up. Do you have a car? Will you need a new computer?</p>
<p>So far I have about $500 in my checking account. I get paid weekly working about 22 hours and about $110-120 a week. Its only a part time job.</p>
<p>But how much will you be working over the summer?</p>
<p>Mom2, are you suggesting that this student who is worried about financial aid purchase a CAR.</p>
<p>To the OP…as noted, $500 of your money will add about $120 to your family contribution. This means you will still have $380 that is not touched for the family contribution. If you spend some of that money on needed things…mabe your books for the winter term…before you file your FAFSA, that would reduce the amount allocated to your family contribution.</p>
<p>Any assets are reported no matter where they are…in the bank or in a shoebox under your bed…still reported.</p>
<p>Personally, I think you can use some of this earned income on needed expenses just prior to filing your FAFSA. Contributing 20% of your remaining balance isnt really so bad.</p>
<p>What you earn this year CAN affect your financial aid if it is over a certain amount.I don’t remember the exact dollar amount; you need to look it up yourself and double check it with a financial aid advisor at your school. Someone here said the threshhold is $6K. If so, you may come close or even exceed it with what you are earning. I believe half of your income over that amount goes towards your EFC, but again check yourself. I keep saying this because it is important that you check these things yourself and see it firsthand, because this is just an internet message board. YOU pay the consequences if we make an erroneous statement.</p>
<p>The way it works with FAFSA, is that the day you complete that form which will be after 1/1/2013 for next year–I am assuming you already did so for the upcoming school year starting fall 2012, you have to report all of your assets you own in that day. So make sure you don’t have much around. Pay your bills, reimburse your parents before you fill out the FAFSA so that you don’t have a nice paycheck newly deposited in there and payments that you are going to be making in the next week or so, all sitting in your bank account, because 20% of that figure you report goes to your EFC.</p>
<p>Get ahold of a FAFSA estimator and you can see for yourself, how YOUR student EFC will be affected with assets on the day you file and with earnings of various amounts. It’s important that you understand how this works. You might want to share this info with your parents as the same holds for them, though to a far lesser extent since only about 5% of assets is assessed to their EFC as opposed to 20% to yours. That is why it is smarter to pay them for expenses and have them save money for you rather than doing it under your own name.</p>
<p>Mom2, are you suggesting that this student who is worried about financial aid purchase a CAR.</p>
<p>Absolutly not. In my earlier post, I told him to use the money for things he’d had to buy anyway…like new tires for his car. </p>
<p>So, I asked if he had a car. If he does, there may be some car repair that is looming out there for him. If so, use the money and fix the car. </p>
<p>If he doesn’t have a car, then does he need a new computer?</p>
<p>That said, I wish FAFSA had some student savings allowance…like 1500 or so.</p>
<p>Mom2, I agree. It really makes no sense that there is not any. It makes it ripe for fraud.</p>
<p>I think it also encourages bad habits, such as not having any savings. </p>
<p>I don’t like the fact that if a kid doesn’t need something, he still is going to feel the need to spend down the acct. It’s fine if he needs new clothes, new shoes, car repairs, or needs a new computer, but if a kid is just out there blowing money, it just encourages bad habits.</p>
<p>Alternate view here. Student assets are assessed at 20%. If a student has $1000 in the bank the day they file the FAFSA they would only be assessed $200 and would still HAVE $800. It’s wonderful that a student can contribute in this waybtontheir education.</p>
<p>^^^</p>
<p>If the kid will be going to a “meet need” school, then very true. If the kid will be going to a school that will gap him a bit, then he’ll be contributing when he helps cover the gap. To have such a kid have to contribute 20% of savings for EFC and to also cover the gap can be too much. Again, I wish the first $1500 of savings or so would’ be excluded.</p>
<p>Most financial aid advice, even from colleges themselves, advise students to spend down their accounts and let savings accrue in the parents name because of the differential in how the EFC is calculated for parents vs students. Better to reimburse parents for all expenses attributable to the student, and that can be defined loosely, and let the parent have an account for student college expenses in the parent’s name. </p>
<p>I agree, Thumper, in cases where the EFC is not going to make that big of a difference for a family and student, but when we start looking at the lower income families where PELL becomes a factor, it can affect the amount of free money the student gets. That is really unfair, IMO and hits those who need it the most AND who are doing something about that need by working and saving.</p>