<p>I'm about to open a new account with a local credit union, and my parents insist that I only put the minimum amount into the checking and savings account so that my financial aid office won't notice (they ask for asset amounts during verification). However, we qualify for simplified needs so I don't report our assets on it anyways.</p>
<p>If you qualify for simplified needs, your assets are NOT counted for FAFSA purposes. BUT if you go to a school that requires the CSS Profile, your assets will need to be listed regardless. CSS Profile (and school financial aid forms) do NOT have a “simplified needs test”. The FAFSA EFC really is for the determination of federally funded need based aid only, not institutional aid.</p>
<p>Also, how much in assets are you talking about? For FAFSA purposes, 20% of student assets and 5.6% (about) of parent assets are used. That’s not a high %age. AND your parents have an asset protection allowance IF their assets are counted.</p>
<p>Is your college one that uses the CSS Profile? If so, it won’t matter. Those schools will require that your assets be listed on the Profile.</p>
<p>In addition the FAFSA question asks for “Cash, Savings, and Checking” … so if you have money and honestly answer the question it does not matter if the money is in the bank or not … it is a student asset. </p>
<p>Since student assets are “taxed” at a higher rate in the FAFSA calculation it often makes sense to spend down student’s assets first … if you need a laptop or supplies for college, for example, spending your money instead of your parents will improve your FAFSA situation in a legitimate fashion.</p>
<p>If you know how much of your own money will be applied toward college expenses, it may make sense to put it into a 529 account. FAFSA will assess that at the parent rate.</p>
<p>It depends completely on the dollar amount of these assets. The student and parents need to know that unless their assets are pretty significant, it’s not likely they will have much change in the FAFSA formula based on a little bit of savings, cash or whatever in the student’s name.</p>
<p>For PROFILE schools it can make a difference. A family I know is fuming because UChicago has a policy that it takes that initial student asset amount and projects student contributions on it for all 4 years. If a kid has all of money in that account when filling out PROFILE, and there is bump for some reason, it can be an issue. Better to report as little as possible. Deplete those assets in the student name by paying mom and dad for living expenses and for any thing you need.</p>
<p>My school doesn’t use the CSS Profile, however it does ask for asset amount for FAFSA verification purposes. So what ended up happening was my financial aid office went on my FAFSA and manually put in the asset amounts I reported to them (questions that FAFSA didn’t ask me), but my EFC didn’t change from 0.</p>
<p>Yes that can happen with verification. You can be asked for your assets when you qualify for simplified needs. And the school can enter them. BUT as you saw, it didn’t change your EFC. </p>
<p>So…if that is what happened…why is there a concern about putting your assets in your accounts?</p>
<p>Well, I’ll be working full time during the summer and part time during the school year, would that bring us over the simplified needs?</p>
<p>For dependent students I believe the student’s income and assets are not considered under the Simplified Needs Formula. Only the parent(s)’ income (must be under $50K) is considered and whether they meet another qualification such as filing 1040A or 1040EZ, receive a means tested benefits program, etc.</p>