<p>OldinJersey:Thanks. But here's the issue: my personal income was 49k. But my business income was 110k. That money does not go into my pocket, but the fafsa calculated as though it does!</p>
<p>cel -- that makes sense. I guess the initial cost of the schools we looked at was a lot lower. I have an efc of about 20K split between two sons. With merit there would be no need above the EFC, I can see where it made sense in your case though. Yes we do have three of the five expected scholarship offers in hand. If they take the merit out of the loan first that is a great thing. My son's reach school is Penn and I don't think they do merit at all. USC might come through as you describe though. learn something everyday :)</p>
<p>Deb</p>
<p>My sons enjoyed the visits to open western schools with outdoor recreation opportunities. Miid to large public settings seemed to be where they felt comfortable. We tried to stick with top 100 engineering schools, not overall school ranking, but there was an exception or two. For example, one has applied to Penn, USC, and Northwestern and we await those notices</p>
<p>We have merit $$ from
Washington State -- solid engineering program
Wyoming -- loved the outdoor focus of the campus
Arizona State -- (ultimate safety for a NMSF but a visit is in order)</p>
<p>We expect merit aid (but you never know)</p>
<p>Utah
CU - Boulder (new program this year)
Limited scholarship from Oregon State possibility but they really liked the Co op program there</p>
<p>Sunshadow, I'm not an accountant by any means, but isn't that business income offset by expenses like rent, supplies, etc.? Or is the $110K after expenses?</p>
<p>We were surprised or didn't cry when our EFC came in at $80,000+. And since we made our son responsible for tuition, books and spending money, that sent him scurrying to find good colleges offering decent merit aid. He did have a $76,000 college fund to work with which gave him a wider range of options. And if the true were known, we probably would have kicked in enough money to avoid a big loan debt at the end of 4 years.</p>
<p>We have been saving for the last 10 years or so, and now have money set aside for each of the four children. Oldest child's account has the most, since we've been saving for him the longest, but there's a decent sum in each.
We now understand that savings aren't necessarily a help when it comes to aid. Does this mean that we should put the money from all four accounts toward child #1's college, leaving little (none) left to consider when it's time for son #2 to go to college in 3 years?
Also, I read somewhere that it's better NOT to put the money in the childrens' names. Has anyone heard if this is true or not?
Thanks.</p>
<p>lspf72, I'd strongly suggest you enlist the aid of a financial aid consultant; you could find yourself in deep doo-doo unless you quickly get expert advice or dig into the research yourself.</p>
<p>Ispf72, children's accounts are assessed higher (this year about 20%, in previous years 35% of balance) than parents' accounts which are hit at a bit more than 5%. As Celloguy suggests, you should get some financial advice about this, particularly if you are possibly eligible for financial aid. It might be a good time to start spending down this money and setting up segregated parents accounts to pay off any loans that the kids may take for college but in the parents' names and ssns. I don't know if you can just throw the kid's name on each account as secondary and not have it counts as the kid's. You'll have to check that out--or does anyone here know for sure? (check all of this out, by the way, as you should all advice , particularly from boards like this and word of mouth from non pros.)</p>
<p>As to how you specifically should save money for your kids' education, this answer can be so individual that you should talk to a financial advisor. Do you want to open Roth Iras for them if they are in that situation? Should segregated accounts for each kid be put in parents names? Should they just be in parents' assets/savings with a will specifically spelling out whose money is whose? Should they be put in one of those special college accounts that do enjoy (at this time most of the time) some protection from the talons of the financial aid process? Answers can vary depending on situation.</p>
<p>Ugh. The accounts were set up with the assistance of a financial consultant, and we have been adding to them faithfully ever since. It looks like we are going to have to reassess this whole business... Also, we found the FAFSA form to be less comprehensive than expected. There were a lot of things specific to husband's work (he's self-employed) that didn't seem covered specifically.</p>
<p>I have certainly heard that the less assets are in the kids names the better for financial aid purposes. Not much of an issue in our case. We have some college savings but they are in 529s which count as parent assets for FAFSA.</p>
<p>I would be cautious about using the funds you have set aside for individual children to pay for your oldest's education. Before I would even consider doing that, I would use one of the online calculator's to see how your EFC might work out with no money set aside for the last child. While it <em>may</em> make sense to "Spend down" any savings you have for college, if your EFC without that money will likely be pretty high for that last child anyhow, it would, in my opinion, be preferable to stick with the plan of having money set aside for each child's education. You simply can not predict whether any particular child will receive 100% demonstrated need (very few colleges actually guarantee to meet 100% of need), or where they might want to go to college. I would not be the one to have to tell the last child that you can't pay for the college of his or her choice because you spent the money you had set aside for him or her on the older siblings. So, use caution and consider a variety of scenarios - don't just assume that any course of action is the best one for your family without running the numbers yourself. You may also want to look into some 529 plans, or perhaps even consider some of the college pre-payment plans that are out there (somewhere I have a link to the many colleges that participate in this plan - I'll try to find it)</p>
<p>Another important point to consider is how comfortable you are with your children taking out educational loans and working during college. I think people often forget that it is the rare financial aid package that is completely based on grants. <em>Most</em> students who apply for financial aid will be offered a package that includes loans and work study. IT's important to keep this in mind as you toy with the idea of "spending down" accounts at the top end of the process. I personally would rather have an educational base for each child set aside - even if it is going to be looked at at a higher rate - than rely on financial aid for the younger kids.</p>
<p>I do sympathize, however, with your quandry about the accounts being in their name. My children's great grandmother opened a trust for both of my kids when they were young, and yes, they were in their name. Too late now, although we are very grateful to have the money to help pay for college because even if it had been in our names, we would still not qualify for much need-based aid. Frankly, I am not sure we would have been as dilligent about building those accounts if they had been in our name -- it is likely that a large chunk of it would have gone to car repairs and vacations over the years. Psychologically, because it was in our kids name, we didn't fall into that trap, however. And, do keep in mind the excellent point Xiggi made above about the percentage for children's accounts recently being reduced, from about the 35% to 20%.</p>
<p>Also, we found the FAFSA form to be less comprehensive than expected. There were a lot of things specific to husband's work (he's self-employed) that didn't seem covered specifically.>></p>
<p>Please read the information about financial aid appeals I and OldinJersey gave above about the importance of providing colleges with detailed information about any special circumstances that are not reflected in the FAFSA or the CSS Profile. Colleges can - and often do - make adjustments based on documented evidence that a family can not afford the EFC. It won't get you an adjustment at all colleges, but if you have unique financial circumstances, it never hurts to ask.</p>
<p>There is also always someone waiting to "game" the system. What would stop someone from writing their father/mother a check for several thousand, only to get it back in cash? >></p>
<p>FA officers aren't dumb. They have probably seen every scam in the book. I also do not think they'd consider "direct payments" in the same light as paying medical expenses to doctors, paying for a nursing home out of pocket, inhome nursing care, etc. If a family can show documentation of such bills, and proof that they paid it for the parents, that would probably be taken into consideration as documentation of a "special circumstances" Showing a check written directly to your parents shows nothing of the kind.</p>
<p>I posted earlier about the changes to the assessments rate of student assets. However, there were more changes ... some involving the 529 accounts and other decreasing the impact of the valuation of family owned businesses. </p>
<p>FWIW, it's a myth that the FAFSA is a very complicated beast. Contrary to the CSS Profile, every line of the forms is FULLY explained and the explanations as well as the approach to the professional judgment situations are easily available from the government. With the explanations in hand, anyone can rebuild the entire FAFSA calculator in a couple of hours and know his or her EFC to the penny. </p>
<p>To find the detailed explanations, just google EFC Formula 2007.</p>
<p>My H is the eldest of 5 and his parents paid for total of 16 years of private university educations (the other 4 were courtesy of free tuition at the U where my FIL taught)...When we started having our children my in-laws offered the wise comment that paying for each year of private university education is akin to driving a new Cadillac off a cliff.</p>
<p>Laugh till you cry either way....</p>
<p>There's a huge mound of Caddies below my cliff. First kid in private education in 1980 and the last one won't graduate college till 1914.</p>
<p>1914? your kid invented a time machine?</p>
<p>;)</p>
<p>Actually, you should be happy.... look what it will cost you to send the kid to Penn when he enrolls in 1910 : <a href="http://www.archives.upenn.edu/histy/features/tuition/1910.html%5B/url%5D">http://www.archives.upenn.edu/histy/features/tuition/1910.html</a></p>
<p>:p :p</p>
<p>At the bottom of the UPenn site cited above, there is a link to an inflation index.</p>
<p>"What cost $150 in 1910 would cost $3079.56 in 2005.
Also, if you were to buy exactly the same products in 2005 and 1910,
they would cost you $150 and $7.31 respectively. "</p>
<p>Is there any college that has a $3079 tuition for the year? :)</p>
<p>Just checked back here this morning. All good advice, though obviously more complex than we'd ever imagined. Am forwarding it to husband at his office. He won't go anywhere near a computer here at home.
One last question - there are so many issues in question when it comes to aid that many of you obviously have experience with. Do you think most financial advisers are familiar with them as well? Or is it more of a specialization?</p>
<p>Lurknessmonster: After expenses. So, even though I pay myself a salary of 49k, the rest is considered mine as well.<br>
Question: Since this was a preliminary fafsa, once I do my taxes, and I calculate the actual costs of running a business, if they are significantly higher, will the fafsa recalculate my EFC once I make corrections? And does the recalculated amount automatically go out to the schools already listed, or do we have to do the list over again?</p>