My parents earn a very low income. The only concern I have is my parents savings account. My dad has never been able to keep a secure job so he decided to have a savings account just in case. Now I get told by my college access counselor that I will need to pay quite some money to private schools. I just wanted to make sure if this is true. If so, any idea how much saving accounts get taken into consideration?
Your parents will have an asset protection allowance based on the age of your older parent. After that, 5.6% of the amount in the accounts are considered ‘available’ each year. Qualified retirement accounts are not included except for contribution made the year before.
How much is in your parent savings? If it’s $100,000 after the asset protection allowance, that would add $5600 to your FAFSA EFC.
Is your parents’ income below $50,000?
Your parents are low income and frequently unemployed, so how much could they have in savings??
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pay quite some money to private schools.
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Do these schools use CSS Profile to determine aid?
If your parents are low income, then their assets may not matter for FAFSA only schools, but at privates that use CSS Profile, their assets will matter.
Since that person has told you that you’ll have to pay a lot at a private school, then it sounds like you told that school counselor how much the savings is, and they’ve concluded that it’s high enough that your family will have to pay some towards college.
We need more info. How much is in savings? How much does your family earn each year?
My parents income combined is $30,000. In their savings they have $60,000. Most of the colleges I am applying to use the CSS profile, so I know that those schools look at everything my parents have. I just hope I am not expected to pay an insane amount of money just because my parents decided to save some money.
The very best advice we can give here is the advice we give to everyone: cast a wide net. Make sure you have a safety school where you could go if nothing else works out. This should be a school where you are sure you will get good aid. For example, if your state meets need for the lowest income students, you will probably get a great deal … try the Net Price Calculator on your state schools’ websites. Also, try the NPC for your Profile schools. If your parents don’t have their own business, you should get a pretty accurate result by inputting your info. In the end, I assume you have already applied and are waiting to find out about aid. With a safety in your back pocket, you will be okay if the others don’t work out. And you just may be pleasantly surprised to find that a Profile school ends up being a good deal for you.
Run the NPC. I can’t imagine that schools that “meet need” would expect your parents to “pay quite” a bit when their income is only $30k and they only have $60k saved. However, it’s amazing that with a low income and your dad’s spotty work history that they’ve been able to save that much.
What schools did you apply to?
High cost at a school may be because the school does not meet need, not because your parents saved some money.
So…your parents earn less than $50,000. Do they also meet one of the followings:
- Able to file a 1040A or 1049 EZ tax for
OR
- Qualify for a means tested benefit like SNAP or free/reduced lunch
OR
- Parent is a dislocated worker.
If so…you could qualify for the simplified needs test…and your assets (savings account) would not count for FAFSA purposes.
But that isn’t going to help you for Profile…there is no simplified needs test for the Profile.
What schools? If thes are schools that meet full need for all accepted students, you could still net a good amount of aid,made pending on how much your parent has in that savings.
I applied to the public universities in my state, California. FAFSA did not ask me about my parents savings, but that only helps for CalStates and UCs. All the private colleges I applied to required the CSS profile. I believe that my counselor made sure that all the private schools I applied to were need based.
All schools give some form of need based aid. What we are asking…do your profile schools,guarantee to meet FULL need for all accepted students?
If the FAFSA skipped the parent asset questions, the amount had to be less than the asset protection amount. Either that or you qualified for the simplified needs test.
What was your FAFSA EFC?
Just because a college offers some need based aid does not mean they meet need. Most colleges don’t fully meet need. You can’t expect your GC to look out for you on this issue – they don’t fully understand your family’s finances. You should run the net price calculator on each school’s website to see what you would be expected to pay.
Which privates did you apply to?
BTW…the UCs give very good aid, but the CSUs do not.
Can the calgrant be used at private schools, or just CA publics?
Did your parents have a lot of unreimbursed medical bills, I think the CSS profile does take that into consideration?
Here is an example of net price calculator output at Occidental college:
I put in family income of $30,000, 3 in household, no income or savings of student, $60,000 parent savings, no home owned.
Estimated Costs of Attendance
Estimated Tuition Costs
$48,690
Estimated Housing & Meal Plan Costs
$13,946
Estimated Other Fees
$558
Subtotal: Comprehensive Fee
**$63,194**
Estimated Books & Supplies Costs
$1,244
Estimated Transportation Costs
$1,002
Estimated Personal Expenses
$1,606
Total Cost of Attendance
$67,046
Estimated Grant Aid Available
Estimated Grant Assistance
$40,695
Federal Pell Grant
$5,725
California State Grant
$9,084
Total Grant Aid Available
**$55,504**
Estimated Net Price
(Costs - Grant Aid)
$11,542
Estimated Other Aid Available
Estimated Student Employment
$3,100
Federal Student Loans
$3,500
Occidental Student Loans
$2,200
Total Other Aid Available
$8,800
Estimated Cost of Attendance(Net Price - Other Aid)
$2,742
So it looks like the direct billed costs (tuition,fees, room, board) would add up to $63,194 (the other items in the Cost of Attendance are estimates for books, supplies, personal expenses and travel and depend on your personal situation, you can save some money on books by renting, buying used, etc.)
They calculating that you could receive total aid of $55,504 (federal grant, CA grant, institutional grant).
So the remaining amount would be $7,690
You can take out a student loan for $5,500, also plan to work this summer to earn money for books, transportation, supplies. You can probably get a campus job through work study and earn some money for necessities, books for second semester, etc. during the semester as a paycheck.
So it does not look like the school penalized your family for the savings account. But every school will be different.
But with the Calgrant and Pell and direct loan you should hopefully find an affordable school in CA.