My daughter is a senior, and she’s applying to high selective schools, the combination of incomes from my husband and mine is less than 45K, but I had and inheritance in 2010 and have rental properties and some brokerage acc, totaling 450K, could that hurt my daughter, we wouldn’t be able to afford high sticker price for HS Universities. The 450K is all we have and we are in our mid 50’s, I son upset thinking that I will crush my daughters dream…I appreciate any answers thank you
Run the net price calculator on each college website to see aid estimates,
Also, make sure she has some admission and financial safeties, so she has options.
They do look at parental assets, but assets have less of an impact than income. The best thing to do is pick a few of the schools your daughter is looking at and run the net price calculator on that college’s website.
Also – if she’s good enough to be applying to highly selective schools, she’s good enough to get merit scholarships at schools where she’d be in the top 25% of the freshman class. Make sure she’s applying somewhere you can afford.
I think you need to be very clear with your daughter exactly what - if anything - you can pay toward college. Run the Net Price Calculators at some colleges on the list, but it’s my understanding that they may not be that accurate if you have rental property.
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high selective schools, the combination of incomes from my husband and mine is less than 45K, but I had and inheritance in 2010 and have rental properties and some brokerage acc, totaling 450K,
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Highly selective schools usually use CSS Profile and they will consider everything.
Your and H’s incomes total $45k…but what about the rental income? And the brokerage income? That will all count as well. What is the total income?
Is the $45k from two working incomes? Is any of that from a business? Or does either of you take business deductions?
Do you also own the home you live in? How much equity is there?
Be upfront with your DD about the situation and how the assets can’t be spent on college because (I’m assuming here) those funds will be for your retirement.
If your DD has the stats for selective schools, then she has the stats to get some merit scholarships.
What is your home state?
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Well, you won’t be the first and you won’t be the last. Seriously, kids can have some expensive dreams and, as parents, we have to accept that we’re not on the hook to provide for pricey dreams.
Also…keep in mind that the DREAM is the future career and adult life…not 4 years of undergrad that passes in a blink of an eye.
What are her stats? What schools is she considering? What is her career goal and major?
This is a too-familiar problem on CC, but at least you are looking at it now, and not next spring!
Check out the high award universities (university of alabama, for example). If she is a super star (applying to tippy top schools), check out the super selective scholarships at places such as UVa and UNC-CH.
As the others have said, be prepared for NPC to be wrong & be prepared for the top schools to decide that you can afford to pay more than you think you can based on income. Most will think it perfectly reasonable for you to spend a good amount of that $450K on them.
It may be hard for her to get her head around less impressive names, so the sooner that starts the better: those are the names that will want her enough to incentivize her into coming. Her focus needs to shift from ‘where can I get in’ to ‘who wants me enough to make it affordable’. It can be done, but it will be a lot happier journey if she buys into the idea that she can take real pride in having the payoff from all her hard work be that she will get a good college education with little or no debt.
First of all, at the risk of saying what you already know very well: Being in your mid 50’s with low income and 450K in savings, you are going to need the 450K when you hit retirement age. This is enough to help a lot in retirement but is not enough that you can afford to lose a big chunk of it to college expenses or to other expenses. Also retirement is often not a choice – as people age there are some jobs that people can still do but many jobs that people just can’t do anymore after some point which often shows up somewhere in the 60’s.
You will need to run the NPC and see what it says, but I am not sure how accurate it is in these “high worth low income” situations.
We had a vaguely similar situation and found that many top schools are going to have a definition of “what we can afford to pay” which is wildly out of synch with our definition of “what we can afford to pay”. Unfortunately “low income, high worth, near retirement age” seems to be one area where the “out of sync” appears to get particularly bad. Our youngest with straight A’s, high SAT and being the top student in her high school ended up at a great small university which is a great fit, academically appropriate and very reasonably priced – but it isn’t in the US.
I think that it likely that you too will find that financial considerations will constrain which schools are possible. However, you should be able to find a great fit at a reasonable price somewhere. Good luck and best wishes.
You may have to look at colleges that offer merit aid, depending on her stats. Also there is your state flagship.
It is very difficult to have to tell your children that you can’t afford to send them to their “Dream” college, but if you have spoken to them about finances and have involved them in their own banking, they do understand.
It helps if they have summer jobs. The first time they earn $1000, they realistically “LEARN” how hard it is to earn money; then they apply that to large costs of college.
Your child does not want you in extreme debt.
If she’s smart, she’ll figure out how to find merit dollars.
We are in a similar boat and we are looking for merit.
We have concerns about retirement but also two younger children whose education we have to worry about.
Sometimes I feel sad that I can’t give more freely to my D who works incredibly hard, but I always try to remind myself I’m fortunate to have this problem. I could very well have nothing at all to give her, like a lot of people out there.
My advice to the OP:
Try to plan ahead to see if you can meet the simplified needs test and identify some FAFSA only schools that your D likes.
Each year, try to move the maximum amount that you can into IRAs.
see above^
Agreed. Lower income parents saving for retirement outside of qualified retirement accounts is a need-based aid problem and can put a comfortable retirement in danger when there’s a much greater tension between paying for college and affording retirement.
Awhile back, someone posted that too often, the first time many of this generation of kids has really heard the word, "no, is in regards to an unaffordable college choice. Since I’m in a couple of large groups where people, many with modest incomes, have borrowed to the hilt to send their kids to their dream schools, it’s sad that there are still parents who can’t even say “no,” then.
Thank you everyone for taking the time to answer. The 45K is with the rental income, and the gain from the stocks (conservative brokerage acc) and yes this is for our retirement, which to me is really not that much, Im don’t expect her to go full ride, I would be comfortable paying 25K a year, (help from my mother), Im sure she will get some kind of merit scholarships, but I couldn’t afford sticker price 70K per year, her choices are Columbia, Boston College, Boston University, Northeastern, University of Miami, Tulane. Fafsa opened October 1st, and we have to use 2016 Taxes, Im in the process of filling now. Thanks everyone again!!!
@pamelamk What is your state?
Just in case she isn’t doing it, I would think she should also apply to your top state school, which probably costs around $25,000 (maybe less with some merit).
I’d also think she should look for a couple of schools where merit is more of a sure thing, and more likely to cover most of tuition, if not all. Right now you have Columbia (no merit), BC (only 20 students get merit), BU and Northeastern (possible merit, but probably still at least $40K even with higher awards like $25K), and Miami and Tulane (maybe a good chance at merit, but also might still leave a large amount to pay).
We Live in Florida,
@pamelamk Do you have an affordable Florida option?