financial aid help

Paying for College
1

<p>I'm a high school junior, and my sister is a high school freshman. We go to an all girls private high school. My parents make around 30k a year. A year or so ago, my mom got some inheritance money and bought a vacation house. My parents did the EFC calculations on collegeboard and it came out to 23k. We can't afford that. My parents also used the EFC calculator in finaid. Because of our income, our assets were disregarded. </p>

<p>As far as I understand, the FAFSA will disregard our assets. However, most of the colleges that I'm looking at also require the CSS Profile. The CSS profile uses assets, correct? </p>

<p>So, my parents are unsure about how much they are expected to contribute, and how much financial aid we might get. I don't know how much my parents expect me to contribute either. They don't really want to talk about it... Mom basically just thinks I'll get alot in scholarships :/</p>

<p>Owning two houses is quite expensive. We can't afford it anymore. My parents are taking out loans and everything, but it just isn't working. They really wanted to keep us in private school but we just can't afford it anymore. Therefore, my parents have decided to sell our house and move to our vacation house. We will be moving in about 6 weeks. Then, my sister and I will start public school in January. My parents plan to pay off their debts but they aren't sure what to do with the money. They want to save it for retirement. Their financial advisor suggested stocks, but they haven't talked to him about college yet. </p>

<p>I did a rough estimate using collegeboard's EFC calculator, and with liquid assets our EFC comes out to 40k now. Unless I did something wrong, this doesn't look too good. My parents can't afford the first EFC or the second!</p>

<p>So, does anyone have any advice as to what to do? We have to move, thats pretty much decided, unless they change their mind, which I doubt they will. </p>

<p>Would putting the money in stocks be a good thing to do, or is there a retirement fund that they can put it in that the FAFSA or CSS doesn't look at. Or what...? My parents pretty much spend all their income every year, so they need the money for when they retire. </p>

<p>I just don't know what to do... </p>

<p>As a side note: I don't want to go to an instate college, they are just way too big for me. I'm looking at small LAC's in Northern Cali, Oregon, and Washington. Right now I really like Reed. :D I don't want to go to a community college either. There are none where we are moving to, and I don't want to live with my parents :P I don't want to get an apartment and go to a cc either. </p>

<p>So, any advice would be helpful. Thanks!</p>

2

<p>Sounds like you have the basics down pretty well.</p>

<p>Two different formulas for calculating EFC-- the FAFSA and the Profile. Once you've sold one home, with income under 40K, the FAFSA formula should be quite favorable under either the simplified needs test:</p>

<p><a href="http://www.finaid.org/educators/needs.phtml%5B/url%5D"&gt;http://www.finaid.org/educators/needs.phtml&lt;/a&gt;&lt;/p>

<p>or the automatic zero efc. Your equity in your primary home won't count, nor will other assets derived from the sale of your other home. So if you're considering one of the many schools that only ask for the FAFSA, you should be fine so long as the other home is sold by the time you file. If for some reason you don't qualify for simplified needs test, the proceeds of your home might count toward EFC if they exceed the parental asset allowance, typically around 40K (depends on number in family and age of oldest parent). If this is the case, look into sheltering those assets into a retirement account to the extent possible, or into a 529 tuition plan, some of which just got very favorable treatment this year and aren't counted as assets on the FAFSA.</p>

<p>Many of the top tier privates require FAFSA and Profile-- and they calculate the EFC via the Profile. Profile does consider home equity-- but 28 of the top colleges that require the Profile cap home value at 2.4 times income, and then deduct the mortage debt from that figure to get a home equity figure that's assessed. So with a low income, it's unlikely that you'd be assessed anything from your home equity toward your EFC at all (2.4 X 30K = $72K; subtract your mortage from that and you've got nothing left).</p>

<p>Here are the schools that do the 2.4X cap (my list may be dated, check with each college):</p>

<p>Amherst College
Boston College
Bowdoin College
Claremont McKenna College
Columbia University
Cornell University
Davidson College
Duke University
Emory University
Georgetown University
Haverford College
Macalester College
Massachusetts Institute of Technology
Middlebury College
Northwestern University
Pomona College
Rice University
Stanford University
Swarthmore College
University of Chicago
University of Notre Dame
University of Pennsylvania
Vanderbilt University
Wake Forest University
Wellesley College
Wesleyan University
Williams College
Yale University</p>

<p>So either way, once you sell the second home, I'd think you'd be in very good shape financial aid-wise, and you should be able to get an EFC close to zero.</p>

<p>Now, that doesn't mean a free ride. Many colleges won't meet full need-- you can look up individual colleges on College Board to see what % of need they typically meet. And then remember that the financial aid package will include Grants, Loans, and Work Study. </p>

<p>Use Finaid to research further, and use their calculator to try different scenarios. Do try to get the second home sold before you complete the FAFSA or Profile, and shelter the proceeds (legally) if needed so that it doesn't make your EFC skyrocket. Look up individual colleges on Collegeboard to see what their financial aid track record is.</p>

<p>I'd recommend reading Going to College Without Going Broke, by Princeton Review. It colvers all these issues and is very readable. I read it before taking the path your taking, and have referred to it dozens of times since.</p>

<p>You'll be fine-</p>

3

<p>And kudos to your parents for managing to send you both ('til now, anyway) to a private school on 30K per year.</p>

<p>Oh-- and in reading the link above about the Simplified Needs Test, they refer to the Federal Methodology. Federal Methodology = FAFSA. Institutional Methodology = PROFILE. The make the jargon hard on purpose, I think. :)</p>

4

<p>Here's Reed's financial aid info from College Board:</p>

<p>Out-of-state tuition and fees: $34,530 (ouch!)
Room and board: $9,000
Books and supplies: $950<br>
Estimated personal expenses: $900
Transportation expense: $750</p>

<p>Financial Aid Statistics</p>

<pre><code>* Full-time freshman enrollment: 354
* Number who applied for need-based aid: 224
* Number who were judged to have need: 177
* Number who were offered aid: 165
* Number who had full need met: 158

  • Average percent of need met: 100%
  • Average financial aid package: $28,205
  • Average need-based loan: $2,684
  • Average need-based scholarship or grant award: $27,387
  • Average non-need based aid: Not reported
  • Average indebtedness at graduation: $17,175 </code></pre>

<p><a href="http://apps.collegeboard.com/search/CollegeDetail.jsp?collegeId=3928&profileId=2%5B/url%5D"&gt;http://apps.collegeboard.com/search/CollegeDetail.jsp?collegeId=3928&profileId=2&lt;/a&gt;&lt;/p>

<p>So the bad news at Reed is that it's about $46K per year. The good news is that they meet 100% of need, with an average financial aid package of about 28K, nearly all of which is grants and not loans. I'd cast a fairly wide net, though, and not get your hopes up on any single college, remembering that the financial aid packages will vary widely, and cost will be a big factor for your family.</p>

5

<p>I would recommend looking at schools that use the WUE

[quote]
WUE is the Western Undergraduate Exchange,
a program coordinated by the Western Interstate
Commission for Higher Education (WICHE). Through
WUE, students in western states may enroll in many
two-year and four-year public college programs at a
reduced tuition level: 150 percent of the institution’s
regular resident tuition. In all cases, WUE tuition is
considerably less than nonresident tuition.

[/quote]
</p>

<p>Oldest graduated from Reed- I would guesstimate going by what I know of their financial aid figures that a student loan amount at graduation of $17,000, is with an EFC of $15,000 ( Reed uses FAFSA & PROFILE as well as their own forms- every year you reapply)</p>

<p>If you really like Reed- and since your parents seem to be fairly impulsive so they might go along with this- convince them to sell both their houses * now* because if you are applying in 2007 to attend fall 2008- you want the money tied up in retirement accounts not counted as income- then they can take a small portion and buy a bus to travel in while they homeschool you and your sister-
Reed loves that stuff ;)
Anyway they will expect your family to come up with the EFC- they don't give any merit aid & they don't haggle.</p>

<p>But there is the <a href="http://wiche.edu/sep/wue/%5B/url%5D"&gt;http://wiche.edu/sep/wue/&lt;/a>
we are looking at it ourselves for D2- and found a few schools that look very appealing- 150% of instate tuition is very nice :)</p>

6

<p>My parents owe nothing on the vacation house (the one we're moving to.) So, I don't think there is any mortgage to deduct. Do other colleges cap home value too? Would I be able to find that info on the college's website?</p>

<p>I'm pretty sure we will get the house sold before we file the FAFSA & Profile. Though I don't think we can manage to sell it before this January. Does that matter, since we will be filing the forms next school year. </p>

<p>Any ideas as to how to legally shelter the proceeds from the house? </p>

<p>The house we live in right now is worth a bit more than our second house in the mountains. Funny, because the second house is SO much bigger than this one. </p>

<p>Thank you for all your help! :D</p>

7

<p>lol. My dad is a bit impulsive, but mom isn't. No, I don't think that would work :P My parents love the cabin in the mountains. And homeschooling would just drive us all crazy!</p>

<p>I really do like Reed, but I need to visit. Mom said we could probably go during spring break. We were planning to drive and travel up the west coast visiting colleges along the way for a week and a half... but I'm not sure that will happen anymore. </p>

<p>Thanks, I'll take a look at that :)</p>

8

<p>You're about 200 colleges off!</p>

9

<p>Did you fill out the SSS for private school? Your situation is neither simple or hopeless, but because there are so many variables, a simple response would be worthless, like the one that left out 200 CSS colleges and said you'd be fine - nonsense!</p>

10

<p>{quote] You're about 200 colleges off![/quote}</p>

<p>I don't remember reading where sblake said that his/her list was a comprehensive list of all shools that take the profile or cap home equity</p>

<p>The college board has the complete listing of schools that accept the profile and as blake stated you can check or e-mail each school you are interested in to find out how they handle home equity</p>

11

<p>The parents must have gotten decent aid for two children in private school with that income . We were in that income catgory & my D did work-study and athletic scholarship as well as some merit to go to her private high school . It's too bad they did not know about "other " homes on financial forms to keep you in private schools. This same exact thing happened to my recently divorced sister-in-law who bought a time-share with her divorce proceeds in the same year she applied for private school for her 8th grader.</p>

<p>There ARE a lot of colleges ( did you look in the Loren Pope book ?) that do not take PROFILE . Isn't Evergreen State College a lot like Reed ?? </p>

<p>With that income level , your parents need to think about retirement so hopefully , you and your sister will assist by keeping an open mind about other schools than Reed . Good luck !</p>

12

<p>Well, I think my parents make more than 30k a year, but thats the adjusted gross income. My dad owns his own buisness, so once all the expenses are deducted...I'm not sure how that all works out, but it does somehow. </p>

<p>I'm not sure what a SSS is. </p>

<p>My parents got financial aid at my last private school, but I don't think they even filled out the financial aid form for high school. Our high school is 5k a year, for each. But, they do take out loans and stuff.</p>

13

<p>As I stated above, the list of 28 colleges are the colleges that have adopted the 2.4X income cap to determine home value, and then deduct mortgage debt to determine equity that can be assessed toward EFC. NOT the full list of Profile schools. Duh.</p>

<p>These 28 colleges are collectively called the 568 Group. Details from a September '06 GAO report are here:</p>

<p><a href="http://www.gao.gov/new.items/d06963.pdf%5B/url%5D"&gt;http://www.gao.gov/new.items/d06963.pdf&lt;/a&gt;&lt;/p>

<p>This report includes the different treatment these schools apply to the Profile in determining the EFC, and also lists the schools currently participating. Bowdoin and Macalester are no longer part of the Group; Brown, Dartmouth and Grinnell are currently participating but not on the list posted above.</p>

<p>And beware of people trying to solicit you as a 'client' for a fee. Get the book I recommended (and I have no financial interest in the book), read it, apply their techniques, and you'll be fine.</p>

14

<p>Along with the schools Sblake mentioned and the schools that belong to the Western Undergraduate exchange- I would take a 2nd look at schools in Ca. There are some public schools that are fairly small- Humbolt state for example only has 6,300 students- yes it is much bigger than Reed- but frankly as a parent who has just put a child through Reed- I think Reed is way small- 4,000 to 8,000 would be a size that I would consider as a better number to support students and programs.</p>

<p>It is important to look at Reed- it is a great school- but * quirky* more of a love it or hate it school. If you manage to get up to Portland, I would also look at Lewis and Clark, I believe that along with need based aid, they also offer merit- because I think whatever you EFC eventually ends up at, I expect your parents will need to borrow to meet it- and merit aid will help that a great deal.</p>

<p>Several students on CC and actually attending Reed, have found that the aid offered is not enough for them to attend- despite supposedly meeting 100% of EFC. We had made the committment- to cover EFC, along with my daughter contributing about $3,000 a year from summer work & a work study job that paid for her personal expenses and books.</p>

<p>However, we were not able to cover EFC out of income, but took out a PLUS loan to do so, along with D taking out maximium subsidized Stafford each year & Perkins loans.</p>

<p>If you look outside the west coast, you may find many more schools that interest you that offer more merit aid. In particular, the womens colleges in the east coast offer very generous merit aid as well as need based.
That reminds me- in CA- Scripps is part of Claremont consortium of LACs, which you might look at and Mills another womens college also has offered good aid to young women .</p>

<p>Re Evergreen- a public LAC in Washington state. Yes I have posted that I have seen similarities to Reed. Both don't give grades, although at Reed they do give them to you if you ask- Evergreen has narrative evaluations only. But funding is very different & the way curriculum is presented is very different</p>

<p>This isn't a suggestions thread- so I wont get farther off track- but try and get your parents to sit down with you to plan what they can commit to from savings and income.
The fact that you are interested in doing this yourself, says a lot- this responsibiltiy will translate very well I imagine when you get to the point of writing applications.
My own younger daughter who is your age, has not been thrilled to hear that while she * wants* to go to school in California, her favorite school Santa Cruz, is too expensive for us to seriously consider. Public schools don't generally give merit aid to many OOS students, although U of O did offer merit for her sister.</p>

<p>However- if you are looking in Washington - Western/Central and Eastern Washington universities ( Western is the largest) are part of the WUE group where you only pay 150% of instate tuition.</p>

<p>good luck & I hope your parents have a good financial advisor who knows something about how assets are viewed for college.</p>

15

<p>I'll try to get the book, I have some shopping to do on Amazon anyways :D</p>

<p>Well, its my mom's dream house, she has always wanted a cabin in the mountains. We got up there 3 out of 4 weeks of the month usually. It was a good deal though, its a two story house, HUGE back yard, 5 bedrooms, a deck, big living room, dining room, kitchen, etc. We have new furniture and stuff, so the 'moving' won't be a big deal.</p>

<p>Well, I think I would be comfortable with Reed small. My middle school had 80 kids. That was fine for me, I liked it. Then I went to high school with 300 kids in my grade, 1000 or so total. That was a bit shocking. Maybe the campus is too small, but everything is constantly bumping into each other, and pushing. Locker areas are a mess. I could go on, but I won't :P</p>

<p>Yes, thats why I really want to vist. I don't want to figure out that I hate it right before the application is due! Then what, dream school down the drain...</p>

<p>Yea, we were going to visit L&C too, and I think they don't use the profile, atleast thats what I wrote down in my notebook :P</p>

<p>I was looking outside the west coast, then I figured it might be a bad idea. Traveling home would be more expensive, maybe I won't be able to deal with the cold.. etc I'm still looking all over. No womens colleges though. I've ruled that one out for sure. </p>

<p>I don't want to mislead anyone here. Reed is a big reach for me. My GPA is 3.2 or so. I'm involved in a few EC's, which I will have to drop. And I don't know how I'm supposed to meet the graduation requirements at the new school unless they make exceptions. I have an appointment with my GC next week, and my parents want to talk to the GC at the new school. </p>

<p>I have tried. Both of my parents want me to go to college. Mom and I talk, but she gets tired of it after awhile. We don't have a plan. I don't know how much they will contribute, how much I will. I want to figure it out before next year... whether or not I can apply ED anywhere, etc. </p>

<p>thanks :) & I think mom likes her financial advisor, but they haven't talked about college. She said he might know some things because he has alot of properites and sent his children to college, with financial aid. Or something like that.</p>

16

<p>one thing to watch out for- is some people talk about their kids going to school with financial aid- and what they mean is merit aid.
Many of the top schools don't offer merit.
Even folks who prepare taxes for others- don't seem to be aware that there is a difference. ( going by my personal experience)</p>

<p>Reed doesn't offer merit & frankly with a 3.2 GPA- with their current numbers- it is indeed a big reach.- they do consider other things besides grades- but it is an intensely academic school- with very demanding curriculum.</p>

<p>My older daughter went to a very small high school- 18 in her graduating class and she seemed to be oK with the size of Reed- it helps that it is in Portland a fair sized city I think.</p>

<p>However- her sister who attended a K-12 school through middle school of only about 650 students total, is now attending a high school of 1700 students and likes it very much.</p>

<p>I think physical layout would make a difference towards how the size is perceived. Some schools have residential halls that are smaller, and have students in FIGS freshman interest groups, where you take core classes with the same 30 or so students.</p>

<p>It should help to visit Reed and get a better idea of exactly what you like about it- and then look for those things in other schools to add to your list.</p>

17

<p>Maybe I'm wrong, but isn't merit aid for those outstanding students with 4.0's and great EC's? Etc? I'm not one of those...</p>

<p>I'm looking at other schools besides Reed. I have almost a page full of colleges that match some of my criteria. Still have tons of research to do. And forwarding all the mail I get to my new house, fun! lol</p>

<p>Is Portland a safe city? I like thats its not in the middle of nowhere. There is stuff to do. I don't go shopping all the time, but being in the middle of nowhere is not what I want. To bad I'm moving to the middle of nowhere in 6 weeks! :P Traveling into the city takes time, the bookstores are really bad, no malls, no good clothes stores. There are two movie theaters that show 2-3 movies. Thats what I don't want in a college. Ok that doesn't sound the way I wanted it to...</p>

18

<p>Of the Northwest schools, Lewis & Clark, Willamette and Puget Sound are a bit easier to get into, and offer some merit aid. As a safety, I suggest UC Santa Cruz (although I see your feelings about in-state). UCSC feels smaller than it is (superficially, it's impossible to see much of the campus all at once because of the trees). The eclectic city of Santa Cruz is a short bus ride down the hill. Our Reed daughter thought she would have liked UCSC.</p>

19

<p>lovelykitty:</p>

<p>If you live in a home that has no mortgage, most schools limit how they count the value of your home based on your AGI...that is the bottom line income of your Dad's business, not his gross sales.</p>

<p>If your home is paid for, the other place the you can protect money is by placing all eligible funds into approved retirement funds-IRA, 401K, Sep, etc. Anything that is a true retirement fund could be maxed out for 2006 & 2007 both.</p>

<p>You could ask your parents about their health insurance, if they have an HSA plan, they should be certain to make their full contribution and do it before the FAFSA/Profile is filed.</p>

<p>Another legitimate place for your leftover money from the sale of the house is to be sure all the car loans and any consumer loans (credit cards, etc) are paid.</p>

<p>You can look at this link <a href="http://www.finaid.org/fafsa/maximize.phtml%5B/url%5D"&gt;http://www.finaid.org/fafsa/maximize.phtml&lt;/a> for other ideas to make sure you are smart with your planning. I would be concerned about using the advice of an accountant or financial planner unless they are very familiar with financial aid specifically.</p>

<p>Small schools may work for you, Whitworth, Gonzaga, Chapman, Mills, Whitman, etc could work.</p>

20

<p>
[quote]
My dad owns his own business, so once all the expenses are deducted...I'm not sure how that all works out, but it does somehow.

[/quote]
If your father's income is from self employment, you will NOT qualify for the "simplified needs test" on the FAFSA. ALL parental assets will be considered, with liquid assets being counted more heavily than home equity.</p>

<p>I think in a nutshell the problem is that your parents have too much money. When your mom inherited the money, she probably should have put it away for your college - possibly looking at the benefits of a 529 account. So now you are in the situation where your family is suffering somewhat because of bad planning. </p>

<p>I realize that your family income is quite low, but that is taken into account by the way the financial aid system treats the assets. </p>

<p>I think your best bet is to look at colleges where substantial merit aid is a good possibility (not real likely with your GPA); and/or focus on in-state publics, including the CSU system. My son is at Humboldt. It definitely has a small-college feel, thought there are some issues related to financial cut backs which means that class size for introductory courses is likely to be increased. But it's still probably the best deal going for a California kid who wants a smaller college - the closest thing we've got to a public LAC. If you like living in a cabin in the mountains, then you would probably like living in Arcata. (No mountains, but an incredible redwood forest that will satisfy the cravings of any nature lover).</p>