When clicking on [NEED HELP?} on Q42 - I was surprised to see that UGMA, Coverdale savings and 529 plans were to be included as to the sutdent’s net worth of their investments. At one of the financial aid seminars I thought I had heard it was advantageous to put money into the 529 as it counted as parental asset instead of the student’s. Same for the Coverdale. The idea was that parental assets like the 529 would only be counted at 5% whereas assets held directly by the student would be counted at 20%. (UGMA has always seemed a little ambiguous to me as it’s the kid’s money when they turn 19 (or whever)). Perhaps the way FAFSA looks at these vehicles differs from how the colleges look at them?
"Investments include real estate (do not include the home in which you live), rental property (includes a unit within a family home that has its own entrance, kitchen, and bath rented to someone other than a family member), trust funds, UGMA and UTMA accounts, money market funds, mutual funds, certificates of deposit, stocks, stock options, bonds, other securities, installment and land sale contracts (including mortgages held), commodities, etc.
Note: UGMA and UTMA accounts are considered assets of the student and must be reported as an asset of the student on the FAFSA, regardless of the student’s dependency status. Do not include UGMA and UTMA accounts for which you are the custodian but not the owner.
Investments also include qualified educational benefits or education savings accounts such as Coverdell savings accounts, 529 college savings plans and the refund value of 529 prepaid tuition plans."