<p>The college my son is interested in has recently updated its estimated net cost calculator to include family assets. Including our family assets, which are 90 comprised of our two boys' 529 college funds, increased our estimated cost by between $12,000 and $16,000, from the earlier calculator that had only included income, age, etc. The jump went from 30,000-ish to 42,000 to 48,000 and it appears that our assets make us ineligible for state and fed grants. If anybody has experience with a similar scenario, at a private college, I would greatly appreciate it! Thank you!</p>
<p>Generally, PRoFILE counts 529 funds owned by the parent as parental assets, but often includes ones owned by the students as their funds getting a heavier hit. FAFSA treats the all as parental assets.</p>
<p>thanks. I agree the 529s will be treated by FAFSA as parental assets in figuring out our EFC. What I’m wondering is how does the school weigh the 529s in figuring out what they will offer? And, also, how does the government know how much of our assets are in 529s versus other “regular” places. I understand that all assets are to be lumped together on one line on the FAFSa application…</p>
<p>If this is a school that meets 100% need or even one with very good aid, the original $30k net price would seem to indicate you wouldn’t be eligible for federal or state aid other than loans anyway. Did the initial results without the 529 amounts show government aid? What percentage of the total 529 amounts are the $12k and $16k? That’s how they weigh them.</p>
<p>The government doesn’t know how much is in 529s vs. not. It’s up to you to report the amounts correctly as student or parent assets according to the rules when filling out the fafsa. Now if something would raise a red flag during verification, then perhaps a school might inquire, but I think assets are questioned rarely during verification.</p>
<p>Thanks! The school does not claim to meet 100% need. I think the average is 81 percent. The actual cost is $64,000. Yes, the initial cost estimate, based on our income, showed a state grant of about $9,000 and Fed of about 4. But both of those disappeared when I entered our assets. I’m not sure what you mean by the $12K and $16K. That was the increase in our estimated cost when I including our assets in the calculator. Thank you!! </p>
<p>Why are there two numbers, $12k and $16k, for the increase? If you divide $12k or $16k by the total of 529 funds you get a percentage. That’s the percentage the school is weighing the 529 funds each year. Fafsa weighs parental assets at about 5.64%. By doing the math, you will see whether the school is weighing them at a higher rate.</p>
<p>Unless your EFC per FAFSA was less than $5000, you would not have received any federal grants anyway.</p>
<p>Wise to include assets in the NPC as the FAFSA formula includes them.</p>
<p>Financial aid takes into consideration of both income and assets. Actually, it is a good thing that the college upgraded to include assets so families will have a more accurate estimate. I’ve included two links you might benefit from:</p>
<p>On Financial Aid…
<a href=“Are Investments Factored into Financial Aid on the FAFSA?”>Are Investments Factored into Financial Aid on the FAFSA?;
<p>Look for merit aids:
<a href=“http://www.usnews.com/education/articles/2010/08/23/8-rules-for-maximizing-merit-aid”>http://www.usnews.com/education/articles/2010/08/23/8-rules-for-maximizing-merit-aid</a></p>
<p>Hope this helps. : )</p>
<p>You say that the school your son is interested in “has recently updated its estimated net cost calculator to include family assets.” This change very likely affects how much school-based aid you will receive, but I don’t see how it will make a difference in your eligibility for state and federal grants. Government grants don’t rely on any school-specific formula.</p>
<p>thanks, all! The $12K – 16K just reflect to range of increases that occured when I included assets in the calculator. You have solved one mystery for me: you are saying that FAFSA weighs all parental assets, including 529s, at the 5.6 percent of value. I had thought that college savings plans got the 5.6% weighting and “regular” assets were weighed at full value or a higher percentage. </p>
<p>529s and parent assets are all assessed at 5.6% after the asset protection allowance. Student assets are assessed at 20%. This is for the FAFSA.</p>
<p>Colleges using the Profile can assess your assets any way they choose when calculating institutional need based aid.</p>
<p>And unless you are low income with an EFC of less than $5000, you will not qualify for federal grant money at all.</p>
<p>I’m confused about a statement you made.,you say the school meets 100% of need, but the average is 81%. What do you mean by that?</p>
<p>Thanks, Thumper, I misspoke on the 81%. This school does not claim to meet 100% of need. They say they cover an average of 81% of need. </p>
<p>If the school doesn’t guarantee to meet 100% of need for all, all of this really might not matter…at all. They can award you anything they choose to…or not!</p>
<p>The school may have changed the NPC because experience in the last few years showed the calculator wasn’t good at predicting the actual aid that school is awarding. The NPCs are fairly new, and it’s taken a few years to work out kinks. What you may have received the first time you put the figures into the NPC for that school may have been wrong. I doubt the state aid figures changed that much, it’s just the school was leading you to believe you’d qualify for it but because the state likely uses the federal methodology, which does ask for 529 plans as assets, you wouldn’t actually have received it.</p>
<p>Did you run the NPC for any other schools in your state? Did the results come back that you would get the state grant? If not, you probably were never going to get it from this school either.</p>
<p>Run the NPC for some schools that guarantee to meet full need to get some idea how this works. Sometimes ownership of the 529 makes the difference as to whether they are counted as parental or student assets at PROFILE schools. IF owned by the student, only the student can change the designated beneficiary, so that is considered a student asset. If owned by anyone else, the designated beneficiary can be changed at anytime to anyone, so it’s considered a non student asset. Not always, since schools can count assets anyway they please, but that is the rule of thumb told to me. by a fin aid officer.</p>
<p>NPCs are not accurate for schools that do not guarantee to meet fin aid or that have a lot of merit money, The reason being that until the app is actually in there and being appraised, the range can vary as to how close to average need met any individual student will get. Some schools that go strictly by formula, like some of the SUNYs that I know, will give an accurate result, but that is not always the case.</p>
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<p>To be clear here: a student-owned 529 account is always considered a parent asset under FAFSA. A student-owned 529 account may be considered a parent asset by a school in calculating institutional aid, or it may be considered a student asset, depending on how each school wants to look at it.</p>
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<p>Be careful. Some 529 plans may have limits on how often a beneficiary change can be made (for instance, only once per year), and changing the beneficiary to someone who is not related to the current beneficiary will probably result in negative tax consequences when funds are distributed.</p>
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<p>Sounds like that even w/o those assets you wouldn’t qualify for state or fed grants. Your EFC w/o assets is still too high.</p>
<p>I don’t think there is a state that gives grants to those with EFCs that would have been 30,000ish…lol…and certainly the fed doesn’t! That income is upper-middle class</p>
<p>Thank you all! The responses I have received here have been more helpful than many hours spent elsewhere, including conversations with various official “resources.” It doesn’t change our situation, but I feel better having a better understanding of all this. Happy holidays to all! At least I will be better prepared for our second child!</p>
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<p>that does not mean what you think it does. </p>
<p>There could be a lot of students with little to no need that is easily nearly met with a $5500 student loan.</p>
<p>That figure does NOT include all the kids who got LOUSY aid pkgs and could not afford to attend. </p>
<p>That 81% number means NOTHING. </p>