I am sorry, I see both:
“My grandparents saved a significant amount of money to help pay for my two kids’ education.”
and
“My grandparents would have rather we spend it on vacation, cars, etc than the school just sucking it away.”
Heck, I’d rather keep my home equity than pay it to a college too!
And I’d rather go on vacation and buy my kids cars (we have two and we aren’t getting my son one any time soon) than pay for his college.
But the EFC is not allowing that.
So, OP should:
- run the Net Price Calculators for the “1-2 in state schools and 2-3 Ivy Leagues”, knowing that they are just ballpark figures
- get a handle on EFC estimates - with each bond staying as a bond with 50% for you for the one 80K bond, and 50% for your child for their 80K bond, and with cashing those out
- note that if grandma (your mother) doesn’t mind, she could pay tuition directly to the college, and there would be no gift tax or any other consideration, and though you and your son would have to list the bonds/bond money on CSS Profile and FAFSA forms, grandma paying would not be counted
I’m sure there are more experienced people out there who know about this. I would suggest a CPA or a lawyer, or a financial aid expert.
There are lines on the FAFSA for “parents’ current investments” and “student’s current investments”. That is where the bonds would be listed, if they were not cashed out. Cash, savings, and checking accounts are listed separately.
Would you consider shifting both your portion and your children’s portions of your bonds to your mother only? That would not have to be reported at all, and would get your child maximum FA.
(I am not commenting on the ethics of this, most of us are trying to get the maximum FA we can - perhaps the OP could have put it a better way than “vacations and cars” - or maybe something is not all it seems…)