<p>Hi,
How much of the parents money in a savings account is protected from the EFC? Right now we have a lot of $$$ in our savings acount - much more than usual due to the recent sale of a car and a bonus, but we will be doing some home improvements after the first of the year so that money will be gone. I was wondering if it would make sense to temporarily move the money elsewhere (to a younger child's account that is not in my name). What kind of documentation do you need to supply with the CSS Profile - is ot just the end of the year bank statements, W2's or what? Thanks!</p>
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<p>Remember if you give the money to someone else, there is a limit as a gift of $12K (I think that is the amount) per year.</p>
<p>If your parents use the money in the accounts BEFORE they file the FAFSA and Profile, the money will not be listed as an asset. If the money is IN their accounts the day they file the FAFSA/Profile, they MUST be listed. Any chance they could get their home renovations or whatever done BEFORE these finaid application forms are filed? </p>
<p>Re: documentation…you don’t send any of it with the Profile. The SCHOOLS request documentation if they want it. This should clearly be listed on their websites. Some schools using Profile use IDOC and if that is the case, you submit all the documentation per the IDOC instructions. Otherwise you send directly to the school if they require something. You need to check the websites to see what your schools require and the deadlines for these things.</p>
<p>And lastly…schools do verify a certain number of FAFSA forms annually too. If selected for verification, the school will let you know IF they want anything and what they want.</p>
<p>Re: protection of assets…for FAFSA it varies depending on the age of the oldest parent and the number in the family. I think about $35,000 is protected for a typical married couple, typical age of college student parents, with a family of four (two kiddos).</p>
<p>On the CSS they ask about assets in other childrens’ names, so that won’t help. Pre-paying for home improvements would work. Or, if you have the ability to make deposits to retirement accounts, and then reduce deposits to those accounts next year (convert a this year asset into next year income.)</p>
<p>Or make an estimated tax payment on this year’s taxes before the end of the year.</p>
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<p>Deposits made TO the account in 2010 will be added back in as income. The amount IN the accounts won’t be an asset, but the contributions WILL be added back in as income. Does the family really want to add a large amount to their income. There are also limits on the amounts you can contribute annually to retirement accounts.</p>
<p>Thanks for the advice. So it sounds like I should try to pay everything I can by the end of the year and spend all that I can, LOL!</p>
<p>Yes, but be careful not to let yourself be one of those people so busy trying not to give colleges 5.6% that they leave themselves no financial cushion. And keep in mind that if the college doesn’t meet 100% of need, it probably doesn’t matter.</p>
<p>I would suggest you run your numbers both WITH and WITHOUT that money in your savings in one of the online calculators (using the institutional methodology). Some folks fret over these money things and then realize that the amounts without the money just aren’t that significantly different than with that money in the saving. SO…check.</p>
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<p>^^^Exactly.</p>
<p>Isn’t it just 6 or 6.5% of savings that goes into the EFC?
The bulk of your EFC is based on income.</p>