Does having a very high FAFSA EFC mean my S will not receive any financial aid?
They have out EFC as 1/2 of what we earn. How is that possible?
What schools did you have in mind? Half of your income sounds high (?)
Answering your question depends on a number of things…
EFC is based on income and assets of the parents, but also of the student. If the parents only make $70k but have a lot of assets, the EFC could be over $35k.
It’s up to each school whether to give need based FA after the guaranteed govt aid of Pell grants and loans is awarded. Schools then have leeway to award SEOG and work study, and then any need based aid the school itself wants to give.
Thanks. I guess we will just have to wait & see.
It’s confusing because we had to put both kids 529 accounts on the FAFSA but we won’t use our younger child’s money for our older kid. Also, do they expect people to take money out their 401k?
So, yes, it may look like we have assets but it really isn’t usable money.
Have you used the net price calculators?
You should not include 401K’s on the FAFSA as that is a retirement account and not counted as an asset for financial aid purposes. I can’t speak to how the 529’s work as we don’t have any of those.
Not yet. I was just trying to get over the EFC shock! Lol
And I only recently even found out it existed.
The school also uses the CSS profile so I’m not sure if that makes a difference.
My D attends a school that requires the profile but uses the fafsa efc. If you don’t have anything going on such as divorce, owning a business etc… the net price calculators should be fairly accurate.
Our experience was that profile schools gave us a higher efc than the fafsa …at schools that meet need ( hope that makes sense)
Does your child qualify for merit?
I understand your concern. The “not knowing” period while waiting for financial aid awards is difficult. Here are some tips to help alleviate the stress:
- []Use the Net Price Calculator (NPC) for *each the schools you are considering. Each school has a different formula for awarding aid, so run the NPC for each.
[]Use the same data that you used on the FAFSA as input to the NPC. Generally they are reasonably accurate.
[]Save or print the NPC results from each college so you can compare once financial aid results is awarded
With NPC results in hand, you should have a good estimate of what financial aid to expect from each school.
Good luck!
The formulas assume college will be paid for out of current income, scholarships, loans, and college savings. If you are missing one or more of those you have a problem. You won’t get more aid.
Keep in mind the the FAFSA EFC should be looked at as the minimum you may have to pay. In reality because so few schools meet full need the bill will be higher. It’s really a meaningless number except for Pell Grant qualification. An EFC of over $5,775 means no Pell Grant.
Also, having debt or living in a high cost of living area are not factored into the EFC. Both of those are considered choices you’ve made.
And, no you are not expected to take out 401K funds. But the amount you contribute to your 401K will he added back into your income as it is considered a choice you made. Home equity is considered and expected to be used to pay.
Thank you for all of your responses.
I’ll check out the NPC and start with that. The fact that they don’t consider the COL is a bit odd since salaries are typically in line with COL. I would make half what I make now if I lived in a different area.
Yes but the COL would also be lower. Start with the NPC.
But you could. (Unless the 529 account for the younger kid is a student-owned account, in which case it should not be reported on the older kid’s FAFSA.)
For the primary home, not with FAFSA. Most schools that require Profile will consider primary home equity, but it’s usually capped at a factor tied to income.
How high is your EFC?
@BelknapPoint yes, I could. I could also sell my house but just because I can doesn’t make it reasonable.
@thumper1 if I looked correctly it was in the 70,000 range. Trust me, I cannot afford 70,000 a year
I’m just telling you how the colleges look at it. It’s your money and therefore your asset. You can easily change the 529 beneficiary to another family member. If you want the younger child’s 529 account to be shielded from the older child’s FAFSA, you may be able to change the account owner from you (assuming you are the owner) to the younger child. Not all 529 plans allow a change of account owner like this. And it will make the 529 account a custodial account, which has ramifications beyond removing if from the older child’s FAFSA.
Edited to add: there’s some pretty simple logic behind requiring that all parent-owned 529 accounts be reported on the FAFSA of each child. Because it’s so easy (and not uncommon) to change the beneficiary of a 529 account from one sibling to another, what do you think would happen if a parent-owned 529 account that names a sibling as the beneficiary did not have to be reported on a FAFSA? Every account owner would name a sibling, and not the child for whom the FAFSA is being completed, as the beneficiary of all 529 accounts that a parent owns. After FAFSA is filed and when money is needed to pay the filing student’s college expenses, the beneficiary on one (or more) of the 529 accounts would be changed from a sibling to the student, then changed back to a sibling before the next FAFSA is filed. Rinse and repeat each year.
@BelknapPoint I do understand and I get why, it just stinks for those of us who would not try to screw the system.
I want to make sure both of my kids get equal money from us without having to sell my house 
And I do appreciate your responses. Thank you!
529 accounts held by parents are assessed at 5.6% of value on the fafsa.
It sounds like your student is considering very expensive colleges. One way to cut the costs is to have less costly options on the application list or to have schools where your student will receive guaranteed merit aid.
If your EFC is $70,000…you would only be paying that amount IF your kiddo attended a college that costs $70,000.
If your student attends a college that costs $30,000 a year…you would pay that amount.
Hoping you have some less costly schools on your application list.
@thumper1 yes, he does. Only one school he was admitted to has that wonderful price tag.