I am a senior, 17 years old. I have a part time job and have about $2,500 saved on my mother’s account since I can’t have my own yet. Is this something I’ll need to write on the FAFSA? Or any info about my job. Or is it such a small amount that it doesn’t matter.
Also what do you do when your dad is MIA ;p
Yes. You will need to list your savings amount under YOUR assets. Make sure your mom doesn’t list it as part of hers.
Wait a minute. You say this money is in your parent’s account, not yours? Even if it’s understood by both of you to be your money, if it’s in your mom’s account, you list it as your mother’s. The fact is, money that is in your name decreases your fin aid by muchm much more than if it is in your parent’s name. So it’s in your mom’s account, you list it as HER money, not yours. The fact is, it IS her money. She could take it and use it to pay for food and rent today. It’s in her account! Or if you need a car, or a computer, or clothing, or whatever, you spend it, now, before you file the FAFSA. But only if you really need the stuff, and would have spent it on that thing anyway. It affects fin aid much less than if it were in your own account, under your own name.
Have your mother fill out the FAFSA. Is she legally married to your father? If not, and you live with your mother, then only your mother has to fill it out. Even if they’re legally married, but father has disappeared, then still fill it out with only mother only, because they have chosen to live separate lives, in separate households.
If you wind up at a school that requires the CSS, you can tell that school that he’s MIA, that you get no support from him.
@BelknapPoint i believe I’m correct in saying…if this money IS the student’s money, it doesn’t matter whose bank account it is in. It should be reported as a student asset.
This is flat out wrong, and will adversely affect the amount for which the student qualifies. If it is in his mother’s account, it is HER money. Not the student’s. The mother could withdraw and spend that money today, if she wants to. And money in the student’s name is counted much more heavily against fin aid.
Certainly, no one should deliberately try to scam the FAFSA. But neither does he have to make his situation worse, unnecessarily. If the money is in the parent’s name, or parent’s account, it’s the parent’s according to the FAFSA.
For tax purposes, the mother would be paying tax at her rate, in her name, on the interest for the account. If the mother spent it all tomorrow, the kid would have no recourse.
really, the location of the money is not the acid test. If the money is in a shoebox under the bed, are you suggesting it belongs to no one?
Student assets, regardless of where they are held are…student assets and are supposed to be reported as such.
$2500 in student assets will add $500 to the family contribution…which will still leave the student with $2000 in the bank.
He says that he has two thousand and five hundred dollars from earnings, but that it is in his mother’s bank account. He is a minor. He cannot open a bank account (they apparently think, although that isn’t really true - he can, he just has to have an adult’s name on it too). For tax purposes, legal purposes, and FAFSA purposes, that money belongs to his mother. If she spends it tomorrow, he would have no recourse. If there was interest paid on that account by the bank, she has to list it on her tax return.
For his purposes, that money in his mother’s account would be counted approximately 4x as much against his fin aid eligibility, were he to report it as his. I do realize that this 2500 is peanuts to some families, so much so that you misread it as 25 thousand! But still, it’s relevant for him, and for his fin aid. What I’m telling him is the truth - if it’s in his mom’s account, as far as FAFSA is concerned, it’s his mom’s! Same as if his grandparents had set up a trust for him, that his parents cannot touch, that money is HIS, cannot be reported as belonging to his parents.
Sure, the kid earned the money, and he views it as his. But FAFSA will ding him four times as much for it, if he says it is his, and since it has always been in his mom’s account, and since his mom has legal access to spend it today if she wants, and pays taxes on the interest from it, as far as FAFSA is concerned, it’s his mom’s. In fact, he has to report it as his mom’s, since it’s in her account! If she doesn’t report it as hers, she’s lying about the amount in her account!
It is also not uncommon (beyond keeping money in parental account) for students to reimburse parents for expenses, to shift savings from the student to parent…there is nothing wrong with that (and parents have to report that money of FAFSA). Obviously, one should keep some documentation on that, which is straightforward to do.
Regarding the dad…are you in contact with him? Does he pay child support? Are your parents married? Divorced?
Where did I say $25,000? All I said was that 20% of $2500 is $500. That’s correct, right?
I’m hoping @BelknapPoint will come in.
Keep the funds in mom’s account. It will ask specifically how much is in checking and savings accounts. Follow the prompts.
And FAFSA is only concerned with the parent you lived with for the majority of that year. So that is mom. Again, follow the prompts.
If you apply to schools that want the CSS from College Board completed that gets a little more complicated, but you can document there is no other parent involved.
If your second parent has no involvement, you will likely be asked to complete a non-custodial parent waiver for Profile schools that ask for non-custodial parent info. You will be asked to provide documentation that supports that this parent is estranged from you…and why.
@Pathnottaken In addition to what is in your checking and savings accounts, families must list other money they have. IOW, if they stuff their mattresses, keep money in a box under their bed…or whatever…that must be reported as well by the owner of that asset.
Link to FAFSA draft for 22-23 college year (Tax year 2020). The electronic version will prompt you through the questions, but this is helpful to look over for now.
https://studentaid.gov/sites/default/files/2022-23-fafsa-draft.pdf
I think this is what I’ll do, if FAFSA sees it as my money they will expect all of that to go to my college as that’s my one responsibility right now, whereas my mother has other expenses. I don’t think either of my parents have any plan to pay much for my college, they don’t have the money.
As for my father- he’s undocumented, never filed taxes, they’re married technically since never divorced legally. But I haven’t known about his whereabouts in almost a year and don’t receive any support from him.
The FAFSA EFC formula will apply 20% to your savings. It will apply 5.64% to your mom’s savings (after any asset protection allowances). So it is best to have her report the money.
Will you qualify for a Pell Grant (EFC around $6.5K)? Fill this out with your mom and let us know the result : Expected Family Contribution (EFC) – BigFuture | College Board
How much can/will your mom pay for college each year?
Regarding your dad, it doesn’t matter than he’s undocumented, just that they are separated. Does he have a job? Is your mom in contact with him? Are there any third parties that can attest to his absence (your HS counselor, a pastor at church, etc.)?
parentologist: every one of the quotes above from your posts in this thread is wrong. A student’s money is the student’s money, no matter where it is, even if it is held in a bank account belonging to a parent or anyone else, and the student’s money must be reported on FAFSA as a student asset. What you are claiming means it would be comically easy for a student to shelter from proper FAFSA reporting assets that legally and ethically belong to the student. As you correctly point out, a minor can in fact open a bank account that has the minor’s name on it, and even the minor’s Social Security Number, which means that for tax purposes any interest earned will be taxable to the minor. This is not rocket science. Think about it, especially as it applies to earned income, as is the case here. Do you really believe that a student with high (or any) earned income could magically have the assets resulting from a job reported on FAFSA as a parent asset and assessed at the lower parent FAFSA rate of 5.4% as opposed to the student rate of 20%, simply by stashing the money in a bank account that is titled only in the name of a parent?
So the mother is supposed to say, “That balance in my account isn’t really mine - it’s the kid’s.” Really?
Yes. Really. Just because certain funds are deposited in a bank account titled to person A doesn’t mean that they don’t really belong to person B. Come on, think about what it could mean if your logic applies to FAFSA reporting. Let’s say that a student with divorced parents inherits $1 million from a grandparent and subsequently that money is deposited in a bank account that is titled in the name of the non-custodial parent. Since the assets of a non-custodial parent are never reported on FAFSA (using the current FAFSA rules but I can make this easily fit to what the new reporting format will be), FAFSA would never see this student’s wealth if as you claim it doesn’t need to be reported as a student asset.
Show me where FAFSA rules state that a student’s asset in a bank account titled in someone else’s name should not be reported on FAFSA as a student asset.