<p>my EFC is 35% of my net income (which excludes the 10K in pretax retirement that the fafsa adds back in)</p>
<p>Government wants me to save for my own retirement and then assumes it's income available to spend towards education (for 4 years anyway). How can I save it and have it counted as available for spending at the same time??</p>
<p>FWIW I'm 46, my EFC was 12k for this year and that was with an AGI of 52K and savings of 57K for a family of 2 (me and my son). I actually thing my AGI will be lower this year than last (because of education tax credit) and obviously my savings will be lower. I'm sure if my EFC goes down, I'm not going to see a corresponding increase in aid (my son has a 30K scholarship at a nearly 50K school - it's fafsa only, no profile). I paid my EFC out of earnings and savings this year and he has 5900 in perkins and stafford loans.</p>
<p>He commented how cold it was in the house (he's home for break). I said I was hoping to keep the gas bill below $200 for the month. Put on a sweater</p>
<p>calmom, please - every time people say they're not getting aid, you trot out the "but you're better off than people who don't have a house." No kidding - never said I wasn't. Nor did I say that I'd change places with them. I was not, in fact, complaining. My EFC is what it is for two reasons: we saved (I'm also living with 20 year old furniture and 30 year old carpeting in my house - early Salvation Army type); and my H's small law practice is valued at more than it could really be sold for - if he stops working, his practice is worth nothing.</p>
<p>I did say, however, that in the area of the country in which I live, I am pretty much in the upper middle class. And that the concept that people can "afford" 100% of need schools better than "match" schools is based on the concept that "need" is what people consider their need is rather than what the schools consider their need is.</p>
<p>
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and my H's small law practice is valued at more than it could really be sold for - if he stops working, his practice is worth nothing.
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Unless your h. has 100 employees or more in his small practice, the valuation wouldn't be included in the EFC formula under current standards.
[quote]
the concept that people can "afford" 100% of need schools better than "match" schools is based on the concept that "need" is what people consider their need is rather than what the schools consider their need is.
[/quote]
Who said that? I thought the comment about 100% need schools vs. match schools was simply because the match schools rarely guarantee to meet full need -- so an upper middle class family with an EFC of $30K may pay exactly that for their kid to attend Amherst, but be stuck with a $42K bill for their kid to attend the match school. My d. could attend Barnard for significantly less than it would have cost to attend Fordham, even with merit aid from Fordham (really more of a safety for her, but as I noted above -- the "match" schools also seem to have a tendency to put financially needy "match" students on their waitlist rather then offering any financial aid dollars). It doesn't matter what I think I could pay or what I wished for in terms of aid -- I could run it out on a spreadsheet and figure out that Fordham would cost an extra $9K.</p>
<p>My h's practice may not be considered by FAFSA (3 employees), but it it certainly counted by Profile schools. And we were required to fill out the Profile's business supplement. The schools calculated the practice as if it had some real value.</p>
<p>For many famlies, the ability to "afford" sending their children to college is determined on the priorities they set before their children were born. Filling out the FAFSA, being horrified by the EFC and complaining that their choices are now limited means that they did not properly plan ahead. Folks, Elvis has already left the building.</p>
<p>Sending a child to a private college in not a right but a priviledge. To expect the federal government and colleges to make it financially easier for families for families who did not have a long term savings plan seems to me emblematic of our self centered and indulgent attitudes. Certainly there are many exceptions but we have all seen families with 2 $28,000 cars in the garage of their McMansion complaining about college costs because they did not have a realistic college savings plan. I doubt that any of us here would want to change the FAFSA formula so the we and the colleges our children attend can subsidize their life style choices.</p>
<p>The one FAFSA change that I would endorse is to have a geographic COLA added.</p>
<p>The problem I have with the system is that all are set up to penalize the savers. These includes housing, retirement and college cost. </p>
<p>Just look at current "bail out" of the spenders who purchased more house than they could really afford. Those of us who purchased a small house within our means will not see any benefit.</p>
<p>I would say the FAFSA should look at the income of the past 5 years, regardless of how much saving there are. This way, those who save wins out.</p>
<p>Calmom, my carpet's padding has totally disintegrated; I've put off spending the $5k it will cost to remove and replace the carpet. Most furniture is way more than 20 years old, a lot is hand-me downs. I have kept the house itself in good repair. I don't see that as an option.
It's also a falling housing market in many places due to the subprime loan scandal. It's not so easy nowadays to pull equity out of houses.
I agree with Origianaloog; the COLA in northern NJ is much higher than most other parts of the US. Property taxes, state income taxes, auto insurance, housing insurance are the highest in the US. These are not choices. And no, we can't move. Did any when posting to this thread move to a cheaper part of the country in order to pay for a child's college?</p>
<p>We did move from one state to another to ensure the safety State U is a decent one. Had we not moved, we would have no choice but going to high$ OOS or private schools.</p>
<p>Our cost of living actually went up significantly. We sold our large modern home and paid more for current 2000 sq ft. much older home. But the quality of HS goes up from outside of 1000 to top 50.</p>
<p>Originaloog, the cost of tuition has been greatly outpacing inflation for a long, long time. The college costs our financial planner estimated when D was born 16 years ago are way, way off. Not even the professionals anticipated this astronomical tuition increase. That goes for publics, too.</p>
<p>"I like the idea of looking at the past 5 years of income"</p>
<p>I would LOVE this. There is a difference of almost $70,000 from the first to the last of those years, and the upcoming years will be somewhere in the middle for us, with the top years never again possible.</p>
Property taxes and state income taxes are taken into consideration when filing financial aid forms. Those amounts are deducted from income.
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That is if you qualify for FA at the first place. In H's new policy, AGI (which dose not include fed, progerty, state, etc. tax) > $180k is not qualified.</p>
<p>I don't think any of us are clear exactly how Harvard's policy will play out. There is a lot of decision-making that takes place in financial aid offices, and a general announcement to the press never includes all the exceptions and the finer points of the plans. Certainly it is a very generous plan.</p>
<p>Middle class squeeze, indeed. If only it were limited to education. The middle class is being squeezed out of health care as well, including when it comes time for a nursing home. And we all know who pays the greatest percentage of their income to the government. The Bankruptcy laws no longer protect the middle class either. At this rate, it's only a matter of time before State Schools follow the lead of private schools, and start charging tuition based upon FAFSA. Then, we'll really have something to whine about on this forum!</p>
<p>have we ever reached a consensus on what "middle class" entails?
Are we using economic definition or social/education? Double average national family salary or triple?</p>
<p>
[quote]
Middle Income</p>
<p>Financial aid administrators, educators and public policy advocates often talk about middle, upper and lower income families, but strangely enough there is no official definition of these categories. Even the US Census Bureau doesn't have an official definition of middle income, although they tend to use the middle quintile, which is families with annual incomes between about $40,000 and $65,000. In some cases they've expanded it to include the fourth quintile, yielding a range of $40,000 to $95,000. Sometimes the range includes the second, middle and fourth quintiles, yielding an income band of $25,000 to $99,000. A lot depends on who is doing the asking and what point they are trying to make.</p>
<p>Nobody seems to use the middle tertile, which would yield a clean split into lower, middle and upper income strata.</p>
<p>Some people would argue that middle income should be defined by standard of living, so that someone who lives in an area with a high cost of living (e.g., Boston, San Jose, etc.) could be middle income even at $165,000, even though that income would put them in the top 5% of wage earners nationwide. Although there could be some geographic adjustments to the definition, it should not extend to the granularity of middle income within a gated community. ("Keeping up with the Joneses is just so difficult on $250,000 a year.")
<p>Median family income is roughly $52k. The middle quintile is roughly $43k-$67k. Next highest quntile is roughly $67k - $98k. Highest quintile is $98k plus. Top 5% is roughly $180k plus. Note that he top 5% have assets averaging 4x to 8x those in the middle, with both income and assets growing more rapidly than anyone else.</p>
<p>As to "class", folks tend to like to call it as they see it.</p>
<p>"I don't think any of us are clear exactly how Harvard's policy will play out. There is a lot of decision-making that takes place in financial aid offices, and a general announcement to the press never includes all the exceptions and the finer points of the plans."</p>
<p>It's a way of rewarding those in least of need (need, as opposed to desire) of aid, and who have the easiest access to parental loans.</p>
<p>I don't see any way to make the financial aid process fair. For the neediest families, financial aid is a joke except for those few kids who qualify for those schools that meet 100% of need. Unless community or state colleges are within commuting distances, it is very difficult for many of those kids to go to college. If the kid works, it may be even more necessary to have a car which is a major expense, and the income from the job will be included in calculating financial aid. Also by going part time, the cost per credit and course increases, and the amount of available aid decreases. These kids are also the ones who can least afford loans even govt backed ones. </p>
<p>There are many inequities in the financial aid process. The snapshot picture of finances does not take into account prior years' incomes and needs, but those can be explained to the financial aid offices. THose schools that use PROFILE or their own procedures tend to have the most flexibility in taking into account prior years' needs that have spilled into the current and future years. So those schools that provide a large % of need, are capable of coming up with more $$ than the forms indicate at the discretion of the financial aid counselors. For middle/upper income families who do not have an easy way to pay for college, the issue becomes that of priorities. Though you can advise the college of your family situation that may make it unwise to spend what the formulas say is your college financial responsibility, they often will not take those factors into consideration. A family member with a medical condition that has a high chance of needing ready funds but is not at that point there. A job with a very uncertain future. A relative dear to the family who may have important financial needs. If you have a child with around a 1000 SAT who gets mainly A's and B's in a college prep program that is not that intense, and it is not in the family's best interest to pay top dollar for college, the alternatives often preclude going a way to a private college. If you are lucky, you are in a state that has more than a flagship uni with high standards and the rest pretty much community/tech school that are state subsidized, and can send such a child away to school.</p>
<p>"I think that I forget that when I think of myself as middle income, I REALLY mean:</p>
<p>"middle-income for the population sending kids to 4-year colleges", not for the nation overall."</p>
<p>No one takes the SAT who is not planning to at least try to go to college. As to whether they actually get there, well, at the risk of stating the obvious, too many simply can't afford it.</p>