Don't know if this question even has a fast answer ...

Paying for College
1

<p>Perhaps this is something I just need to do the whole EFC for. But for those who are familiar with the whole FAFSA thing, would it be possible to give an estimate?</p>

<p>If you have one child, and minimal other expenses, would anyone be able to give a ballpark estimate of the income cutoff for any possiblity of need-based aid? We have a cheap mortgage, 2 paid off cars, and some savings. But those savings are for retirement, and we have nowhere near enough for that goal. We have about $25,000 in a 529 and an equivalent amount in regular savings we've designated for college. So for a place like Penn State (expensive state school) we're halfway there. </p>

<p>So at what approximate income do you think we'd have no hope for aid?</p>

2

<p>Since Penn State gives lousy aid, unless you’re low income and qualify for Pell or state aid, expect no free money…only small loans.</p>

<p>What is your income?</p>

3

<p>I used Penn State as an example. I know they give lousy aid. But I’m just trying to get a general idea of what my official need might be - for any college. I know that some will meet need better than others. My daughter would love to go to the main campus, but I don’t think she’ll be able to get in. So who knows where she’ll apply? Right now, I’m just trying to get an idea of what the FAFSA process will determine as our expected contribution.</p>

<p>By income, is it gross income, or income reported on taxes after deductions?</p>

4

<p>The number used on the boards is generally Gross Income and EFC usually comes out near 25-33% of your gross income. YMMV significantly depending on where your income is on the curve. Expected contribution for private schools is also a large unknown.</p>

5

<p>It is AGI income (income before taxes). With a small family (one child), EFC will be a bit higher since family size is considered for EFC.</p>

<p>If you had an AGI of $100k for a family of 3 with one going to college, expect your EFC to be about $30k. </p>

<p>Frankly, if your D’s stats would make PSU a bit of a reach, that suggests that she might not get into any/many of the schools that give good aid. Even with some “need”, she may still get largely gapped.</p>

<p>What are your D’s stats? GPA and test scores.</p>

<p>I’ve found PSU’s NPC to be rather accurate…you should try it.</p>

6

<p>It would be worth your time to work through the formulas the see what your FAFSA EFC is, there can be significant variation depending on what state you live in, ages, family size, assets, etc.</p>

<p><a href=“http://ifap.ed.gov/efcformulaguide/attachments/010512EFCFormulaGuide1213.pdf[/url]”>http://ifap.ed.gov/efcformulaguide/attachments/010512EFCFormulaGuide1213.pdf&lt;/a&gt;&lt;/p&gt;

<p>The FAFSA form is here:</p>

<p><a href=“http://www.fafsa.ed.gov/fotw1213/pdf/fafsaws13c.pdf[/url]”>http://www.fafsa.ed.gov/fotw1213/pdf/fafsaws13c.pdf&lt;/a&gt;&lt;/p&gt;

<p>If you have “retirement” savings that are not sheltered in retirement accounts such as an IRA or 401k, anything in excess of the asset protection allowance will be counted.</p>

<p>The FAFSA doesn’t consider anything on the expense side. So the size of your mortgage, car loans, credit card bills, whatever, have no effect on your EFC.</p>

7

<p>Frankly, unless the family income is low and will qualify for Pell, I don’t see how FAFSA calculators will do anything but likely mislead the family. Learning that a person may have a FAFSA EFC of - say $25k - doesn’t mean that you’d get much/anything at many higher priced schools. </p>

<p>Instead, I would come up with a list of a few schools…instate public, OOS public, mid-tier private, reach private, safety private and run the NPCs on each site.</p>

<p>Notrich is right about what FAFSA doesn’t’ consider (mortgage size, paid off cars, etc). Unprotected retirement accts could be a problem if your assets are beyond protected amounts (about $45k for a married couple…the amount varies by age of older parent).</p>

8

<p>The way it works for financial aid is that there really are only a few schools that guarantee to meet 100%$ of need, and nearly every single one of them define that need themselves. They do not use the FAFSA EFC alone. They will poke and peek into all of your assets, most often including home equity which FAFSA does not include and even eyeball your retirement money. </p>

<p>The schools that use FAFSA alone, which is common among most public school, and I believe Penn State falls into that group, do not tend to meet need. The primary reason for the FAFSA, other than it is often required for hope of any aid, is that it does qualify your and your student for government funds, specifically for the PELL and the Stafford loans for the student and the possibility for you, as a parent, to borrow PLUS if you qualify credit wise.</p>

<p>Just some hints: If you can get some of your retirement assets into a qualified plan, do so, as YOUR designation of an account as your retirement money does mean a thing. It has to be a qualifed plan like an IRA or 401K, some annuities in order to be sheltered. ALso anyhting in your child’s name should be used to pay down expenses and you can correspondingly save for her in your name as any assets in the students name is hit at 20% whereas yours are assessed at a little more than 5% after a protection allowance. That goes for the ownership of that 529 as well. </p>

<p>As a rule, the schools that are the most selective, tend to be the most generous in financial aid. Not always, but often.</p>

9

<p>Oh crap. Mom2 collegekids got the income right. EFC - 30, huh? That’s what I was afraid off. So any money over $45 not in retirement accounts gets counted - is that just the money over 45 that gets counted or the whole thing? We have about $70,000 not in retirement accounts - so is just the 25,000 counted? I’ve seen threads where 3.0 students get aid from private schools - better than they’d get from a public. So I guess I was hoping we could find private schools that would come the same price as a public.</p>

<p>That’s the problem. We make too much for aid, but there’s no way we can afford $30,000 a year. And our daughter is just an average student. But average students need to go to college and have a career, too …</p>

10

<p>Only the $25000 is counted, but assets are only assessed at a maximum of 5.6%, so the most your $25K will add to your EFC is $1400.</p>

<p>

The trick to getting the best merit aid is to find a school where your kid is above the 75th percentile.</p>

11

<p>Or send them to a local CC for two years utilizing Stafford direct loans and save like crazy demons as much as you can for two years and then have them transfer to an in-state 4 year to finish the college. Or pay down any smaller debt to free up cash for the remaining two years. Plenty of people chose this route. But yes run the calculators…most people will be among 20-30% of their income as an estimated family contribution and many if not most colleges gap either literally gap the EFC or gap what families think they can pay.</p>

12

<p>If there isn’t anyway you can afford $30,000 a year, it’s best to identify, what you can afford to pay out of savings, loans and current income.
If you have approx $50,000 earmarked for one child for four years of college, finding an instate public school, that costs say $27,000 ( University of Pittsburg or university Park), will only be $14,500 after 1/4 savings is applied. Subtract the Stafford loan of $5,500 & that leaves only $9,000 to come up with each year. ( for simplicity, we will just pretend that costs will not increase between now & when she begins college). ;)</p>

<p>If she was a superb student, she might get merit aid, but if you find a private school that will offer enough merit aid to an average student to bring costs below what an instate public school would be, be sure to come back and share.</p>

<p>If your EFC is $ 30,000, and the private school costs $60,000, it would have to be one really well endowed school to reduce costs below EFC.
It helps to remember that private schools often look at much more than Fafsa does.
They don’t look at bills & home equity & savings in order to calculate what you can comfortably spend for college costs. They look at it to see what you can free up to pay tuition with.
Even if an average student was accepted to a school that met 100% of need, and even if the school decided to use to FAFSA EFC, the aid package can consist of grants, loans and work study.
Yes, self-help, is considered to meet need.
So if she was accepted to a school that met needs& your EFC was $30,000, they could give her an aid package of $30,000. $20,000 grant, $5,500 Stafford loan, $2,000 Perkins loan, $2,500 work study.</p>

13

<p>We could definitely afford the 2 year cc and 2 year state school plan. But if we can possibly make it work, I would really like her to have the classic 4 year college experience. I think she could really benefit from the independence and being in one school for 4 years.</p>

<p>I think the most realistic idea is for her to go to one of the less expensive pa schools, such as Bloomsburg. But we’re trying to find other options - places with great college towns, etc.</p>

14

<p>Welcome to the crowd. Most people can not afford their EFC. And it’s really unlikely for privates to give 3.0 students big aid. Maybe if it’s a 3.0/2350, but even then it would be tough. This is why we have state schools. Most are not the bargain they once were, so more and more upper middle class kids are starting at a CC and spending their last 2 years at an in state school. Colleges are a lot like cars, everyone can’t afford a Mercedes.</p>

15

<p>I know we cant afford a Mercedes … But I was hoping for at least a Honda! lol</p>

16

<p>Some states have exchange agreements with bordering states for tuition that isn’t more than 150% of instate.
Our daughters applied to schools in Oregon & California, where they would be able to take advantage of the western undergrad exchange.
[WICHE</a> | Western Interstate Commission for Higher Education](<a href=“2014 Annual Report: WICHE - WICHE”>http://www.wiche.edu/)
But I am sorry, I haven’t been able to find any configuration of state exchange programs that include PA.
:(</p>

<p>But you still have time to pressure your legislators to getting one started!</p>

17

<p>

How much do you think you can afford per year from your yearly income?</p>

<p>You’ve got a great start with the $50K you already have, add in the full Stafford amount ($27K), you are at $77K. $11K a year from your income would bring you to $30K per year.</p>

<p>How long do you have before your D starts college?</p>

<p>With only one kid, you also have the luxury of taking some small parent loans and spreading them over a longer period of time.</p>

18

<p>Oh crap. Mom2 collegekids got the income right. EFC - 30, huh? That’s what I was afraid off. So any money over $45 not in retirement accounts gets counted - is that just the money over 45 that gets counted or the whole thing? We have about $70,000 not in retirement accounts - so is just the 25,000 counted? </p>

<p>------- The $45k was an estimate…it varies by age of the older parent.</p>

<p>===============</p>

<p>I’ve seen threads where 3.0 students get aid from private schools - better than they’d get from a public. So I guess I was hoping we could find private schools that would come the same price as a public.</p>

<p>----------That doesn’t mean that they got more aid than their EFC would be. A person could have an EFC of $15k and get NOTHING from a public and be expected to pay the full cost, but at a private they may be expected to pay just their EFC of $15k. So, in their case, a private is cheaper…but that’s also because they can afford to pay their EFC.</p>

<p>You have an unaffordable EFC…that is a totally different story!</p>

<p>Example: Private school COA = $50k
EFC = $30k
need = $20.</p>

<p>So getting $20k in a mix of grants, loans, and work study STILL MEANS that you have to pay the $30k EFC. And you could pay more if the school doesn’t meet need.</p>

<p>However, if your child applies where she’d get a HUGE merit scholarship that covers all need and then cuts into EFC, then you’ll pay less.</p>

<p>You need to figure out how much you CAN pay and tell your D. </p>

<p>Try the NPC on Penn State and other school sites. </p>

<p>==========</p>

<p>That’s the problem. We make too much for aid, but there’s no way we can afford $30,000 a year. And our daughter is just an average student. But average students need to go to college and have a career, too …</p>

<p>----- Yes, they may need to go to college, BUT that doesn’t mean going away to school. That is a luxury. Most kids do NOT get to go away to school. If you want that for your child, you either have to pay for it, borrow the money, or find schools that will give your child huge merit. If her stats won’t allow for that, then you either have her commute or you pay the costs to go away.</p>

19

<p>Emeraldkity4 - Pa, NJ, and NY are the only three states without an exchange agreement.</p>

<p>And PSU is one of the most expensive state schools in the country. </p>

<p>And even the other, “lesser” state schools aren’t a bargain - average schools at best that cost @$20,000 a year.</p>

<p>Financially, Pa is one of the worst places to be for college.</p>

20

<p>I would suggest you plug your financial information into the Net Price Calculators for the colleges your child is interested in. These will give you a decent estimate of your aid prospects at these schools…estimates…but better than nothing!</p>