<p>So I know that retirement funds are technically not counted as assets for college funding. My dad isn't going to put our figures for retirement funds on the CSS/PROFILE because...in his words..."it's none of their business."</p>
<p>Am I going to be penalized for this? Is there a way to note my parents' feelings on this issue? Or does he REALLY need to put something in those boxes?</p>
<p>While the money that is already in the retirement fund is not counted toward your EFC, the amount of money your father contributes to the retirement account is considered income that he could be using for college and he will have to report that amount.</p>
<p>It is also important to understand that just because someone says that funds are "earmarked for retirement", unless that money is in a designated retirement fund (IRA, 401K, etc) -- it is considered an asset that is available for college costs.</p>
<p>many people purchase rental property or invest in mutual funds -- and consider that money invested for their retirement. However -- since it is not officially a retirement fund (according to the federal guidelines) it is not considered a retirement fund when calculating EFC for FAFSA or Profile.</p>
<p>Our son's college FA officer told us they do want to know how much you have in retirement accounts as they do take this into consideration when calculating your EFC. She told us if they feel your retirement is "underfunded" then they will likely allow you to put more away toward retirement and less toward college thus lowering the EFC</p>
<p>To the OP-
Since the Profile specifically asks how much is in the retirement accounts (PD175):
[quote]
Enter the total current value of this parent's tax-deferred retirement, pension, annuity, and savings plans. Include IRA, SRA Keogh, SEP, 401(a), 401(k), 403(b), 408, 457, 501(c) plans, etc.
[/quote]
to not answer is very bad form. Basically it is a refusal to answer the questions of the entity to which you are applying for aid. Remember the Profile is not the government, it is the university to which you are applying. The university is saying, to get our aid, you have to answer questions 1,2,3 etc. What do you think the effect on your aid should be if your parents refuse to answer a question?</p>
<p>I have been told the same as was told to Momof2sons -- my d's college does not increase EFC based on this amount, but it is a factor they may take into account that may in some cases result in a reduced EFC or more favorable award. </p>
<p>I do not know what the college financial aid people consider to be adequate. But this page has a really scary chart showing what financial planners think it should be:
<a href="http://biz.yahoo.com/brn/071003/23102.html?.v=1%5B/url%5D">http://biz.yahoo.com/brn/071003/23102.html?.v=1</a></p>
<p>This page has a chart that give you an idea of what average retirement savings are:
<a href="http://www.fool.com/personal-finance/retirement/2006/03/03/prepare-for-a-gruesome-retirement.aspx%5B/url%5D">http://www.fool.com/personal-finance/retirement/2006/03/03/prepare-for-a-gruesome-retirement.aspx</a></p>
<p>To echo dt123, you are asking for the colleges to give you money, so it certainly seems appropriate for them to ask about what your dad has socked away for retirement! I'm sure financial aid officers have encountered this kind of thing before; it wouldn't be hard to guess how they would respond to deliberate failure to disclose assets. Remind your dad that the colleges are not obligated to give you money.</p>
<p>Sybbie719---So, PD-175 on CSS is not counted to EFC, but PI-190(Payment to tax-deferred pension and savings plan your parents made or expected to make in 2007) is coundted as EFC?</p>
<p>Sybbie may know better, but my understanding is that while assets currently in a retirement account are not expected to be available for college expenses, money that you contribute to retirement accounts are available (so current year funds). The idea is that you are making a choice -- contributions to retirement funds are not mandatory -- and you could choose to fund your child's college education rather than your retirement.</p>
<p>I think that is where the profile colleges may adjust the EFC is the retirement fund is under-funded. Where someone with a million dollars in various retirements funds clearly doesn't need to continue to contribute to then and can use those funds towards college expenses, someone with $10,000 in the retirements fund (at age 40+) does need to make contributing to retirement funds a priority and thus the college may consider those funds less available for college expenses.</p>
<p>I agree with Stef and the other posters that money already in an established retirement account ( IRA, SRA Keogh, SEP, 401(a), 401(k), 403(b), 408, 457, 501(c) plans, etc. ) are not expected to be used for college expenses (however some people do borrow from their retirement to pay for college). </p>
<p>The money that you contribute to the account to the account are funds that the college considers to be available to help pay for tuition. For example, if your parents are contributing $15k in pre-tax dollars to their 401(k)s this year, the money is considered and asset that can be used to pay for your college.</p>
<p>Both the FAFSA and the CSS profile are both very aware that parents are looking to retire one day and both look age a parent age as the child is going into college so even if your parents reduce or stop funding their retirement while you are in college (I know that I cut back drastically to help pay my D's tuition) parents age 50 and over will have the option of increase contributions at a time when retirement draws near. Age-50 catch-up contributions are possible in 401k, 403b and 457 plans, and IRAs where your parents can contribute ~ an additional $5k per year.</p>
<p>Well, we submitted the Profile today and my dad basically put a note in the "special circumstances/considerations" that he wasn't going to put the amount in his retirement fund in the form because he did not consider those as funds avaliable for college. There's really no way for me to convince him to put those amounts in--am I basically screwed as far as finaid is concerned, now? =</p>
<p>I would contact the school this week and ask them that question -- my guess is that your FA file will be considered incomplete without that information and you will not recieve any FA offers until your information is complete. If it isn't completed by the deadline, you risk not getting the best aid package.</p>
<p>So if I've got an early action deadline of november 1st (thursday) should I call on like the following Wednesday and ask? Or do it beforehand? Or could I just send an email with question to the financial aid office?</p>
<p>I would email now (or tomorrow morning) and call them first thing tomorrow morning -- make sure you talk to an admissions person and not a receptionist or work-study student.</p>
<p>of course -- this all depends on whether you really need FA to attend the school. If you are just filing to "see what you might get" but with some belt-tightening, your parents can pay full fare, it probably doesn't matter as much.</p>
<p>But is aid is a deal-breaker, not following the rules to receive aid is suicide.</p>
<p>I sent an email today and based on what they say I'll call the school. </p>
<p>The thing for me is, I'm applying for Financial Aid because it's important that I get something--yet I don't expect to get any. I'm in a weird situation where my parents can pay a disproportionately small amount of money to my education based on what my dad makes. (They're giving $6k and my dad makes like $140k a year...).</p>
<p>So it's kind of weird, but I'm not sure how things'll all work out...</p>
<p>^</p>
<p>It will work out. There are many ways to make this work. Do not let yourself be defeated before the fight even starts!</p>
<p>This is the response I got in the email:</p>
<p>"We require this information. Home equity is taken into consideration for need-based financial aid at the University of Chicago. The total value of a retirement account is not factored into the aid formula, but the base year deferments to and distributions from the account are considered. If this information is not submitted, this will cause a delay in processing aid. </p>
<p>Thank you,
College Aid"</p>
<p>Do you think this means that they won't give me aid at all, or that it will be simply delayed but there won't be a problem...? </p>
<p>I replied and asked about how I could add on the information and they haven't replied yet...so we'll see.</p>
<p>They will not be able to give you a financial aid package if your information is incomplete. Unless they have all of the information that they require they will not be able to move forward on your FA application, leaving you at a virtual standstill. Remember even at schools that meet 100% demonstrated need that they operate with financial budgets and the process still moves forward whether or not you submit your package (it just means that other people's FA packages are processed before yours).</p>
<p>If your aid package is done last, you could end up with a package that may have more loans and less scholarship/grant aid.</p>
<p>I think for the Profile, you print a paper copy and hand write the changes and then submit.</p>
<p>
[quote]
If this information is not submitted, this will cause a delay in processing aid.
[/quote]
Unless you hear otherwise, I would assume this is a nice way of saying you won't get any aid at all. Delayed forever. Hell will freeze over before you get aid.</p>