<p>Hello, I have an unique question. Currently, only my father works, and he makes enough so that my EFC is over the price of a private school (EFC: $57,000-ish), and so I have not received any sort of aid except the typical Stafford loans (which isn't exactly aid). You all know the upper middle class predicament of being able to afford but not really afford these schools, but I was wondering if my situation were feasible.</p>
<p>My dad plans to retire from his job within the next few years. If my dad retires from his job when I am a sophomore in college, then would my EFC decrease significantly? I know that students file for financial aid every year, so I was wondering if my dad's retiring would mean that I would then be eligible for grants/other aid. Obviously my family would still have the investments/savings to account for on the FAFSA, but the decrease in income should make my EFC go way down, right? This reasoning almost seems too good to be true, so I was wondering if anyone had any opinions/warnings about this. Thanks.</p>
<p>If he retired during your sophomore year, that would be the financial info for the FAFSA that would apply to your junior year. Whether it had an imact on your EFC would depend on when during the year he retired (early in the year vs late in the year w/close to regular income), if he had pension income, and - as you say - savings and investments.</p>
<p>You can do EFC calculators to see what a lower income level will do to your EFC with the same assets, but don’t forget to include any pension (“retirement fund”) income he would receive.</p>
<p>I don’t see how retiring early is such a great thing. He’ll have less income, so it’s not like the family will “net” more money. </p>
<p>For instance, with a $57k EFC, that means that your dad’s income is probably around $200k. Does the family want to start living on - say - $75k per year in retirement money, instead of living on $150k (after paying your tuition)??? That’s crazy! </p>
<p>And, if he retires at some point in your sophomore year, his income will probably still be highish for that year…giving you an EFC high enough that will still only get you loans. </p>
<p>Also…what school do you attend (or plan on attending)? If this school doesn’t meet need, you may be doing all these gymnastics and then end up with a big gap that’s not affordable on a retired income.</p>
<p>Keep in mind…if your dad makes the kind of money that gets you a very high EFC, then likely his retirement income and social security money will still be highish.</p>
<p>Thanks for your responses. To clarify - my dad is probably going to retire no matter what, so this is not some way to game the system. The schools that I’m hoping to afford claim to meet 100% of need, but I know how that can often be unreliable. Also, he makes closer to $140k, but has considerable investments. My parents are trying to see if a private school is feasible, and while I would prefer it, I definitely don’t want them to kill themselves trying to manage.</p>
<p>I’ve run a few different FA calculator scenarios, and with an income half of what my dad is currently making (I’m not too certain how pension/social security works so I estimated high) with the same amount of assets currently held, the EFC drops to around $20k. Does this sound right? From the way it sounds, he’ll have to time his retirement well to meet aid year deadlines, yes? Any other words?</p>
<p>*Also, he makes closer to $140k, but has considerable investments. </p>
<p>the EFC drops to around $20k. Does this sound right?
*</p>
<p>It won’t matter what your EFC is because you’re applying to schools that meet 100% of need. That suggests that those are CSS Profile schools and they will expect more from you family. CSS can look at home equity, expect more from assets, etc. I don’t know if they’ll ask to look at a couple of years prior tax returns…but if they do, they’ll see that your dad was recently earning a lot of money.</p>
<p>Remember, EFC is a FEDERAL number. Schools and states are not obligated to respect it except to determine if the student qualifies for federal aid. In reality, EFC doesn’t have to mean anything to them except to co-ordinate fed aid.</p>
<p>he’ll have to time his retirement well to meet aid year deadlines,</p>
<p>True…So, if he were to retire mid-year, his income would still be high. BTW…when your dad retires, will he have to cash out of anything (like accumulated vacation days or anything?)</p>