<p>I just had a couple questions... I'm starting college, and I'm a dependent, but I'm trying to pay as much of my bill as I can so that my parents don't guilt trip me about going away to college. I have a savings account that I'm going to change to a checking account very soon. I have around $3k in there currently. When I filled out the FAFSA, I had about $400. How does the money in my savings account affect my EFC? Does it change for checking accounts? I read somewhere that 20% of a student's savings will be counted, but only about 5% of parent's savings are counted. Is this true? Should I try to set my money somewhere else? My own checking account would be so convenient, though.</p>
<p>Also, I was offered work-study in my fin. aid package. That's aid, so it won't affect my income or EFC, right? But if I have a non-work-study job during school or over summer, how much does my income count according to the FAFSA? Will they raise my EFC if they see I'm making money?</p>
<p>My last question is pretty simple: What is billed to me? UC Santa Cruz's cost of attendance is broken down into fees, food and housing, books, transportation, and personal expenses. I assume that means that the school will send me a bill for fees and food/housing, and I pay out of pocket for books, transportation, and personal expenses. Is that right?</p>
<p>For savings/checking, and any other type of asset you possess, it’s the amount that you have on the day you file FAFSA that counts. Fluctuations, up or down, throughout the year have no impact on your EFC. Also, if you happen to have money in your accounts that are proceeds of student aid like loans or scholarships, they are not included in the EFC calculation. Unlike parents, students have no asset protection allowance and assets are assessed at 20% (vs. 5.6% for parent assets).</p>
<p>Work-study income is part of your AGI for tax purposes but is not considered in the EFC calculation. Students do have an income protection allowance of $4500 for 10/11 and allowances for taxes paid. Above that level, student income is assessed at 50%. Again, it’s based on your AGI from the prior year, so there’s no mid-year adjustment simply because you have a job.</p>
<p>You’re correct that they will only bill you for the fixed costs and the variable expenses will be paid by you as you incur them.</p>
<p>That was really helpful! Thank you! I’ve forgotten everything that was included on the FAFSA, so about the student financial aid that could be in my account… Are there spaces to fill in for that, or do I need to calculate it on my own?</p>
<p>There is a set of adjustment questions related to student income, that’s where your work-study earnings would be reported and backed out of your AGI. For assets, there is no adjustment as the instructions tell you specifically to not report proceeds of student aid. Here’s a link to the FAFSA instructions for reference:</p>
<p><a href=“http://studentaid.ed.gov/students/attachments/siteresources/CompletingtheFAFSA10-11.pdf[/url]”>http://studentaid.ed.gov/students/attachments/siteresources/CompletingtheFAFSA10-11.pdf</a></p>
<p>I think I understand now. Thank you so much!</p>
<p>Before a student or anyone, for that matter, starts filling out the FAFSA, they should pay any outstanding bills, and get those accounts down as low as possible without being fraudulent because, yes, they are assessed. Students especially are hit hard, as they have no allowance. Every penny of your assets are assessed the 20% towards college costs. Your parents, at least, have about $50K that is exempt and are only hit about 6% on the excess.</p>
<p>What ever your account balances are the next day or the next week or month doesn;t matter, FAFSA relies on a snapshot of that single day, and once you file it, you cannot change those numbers. You can explain and appeal, but the numbers are right there and you do have to deal with them.</p>
<p>Try to get your parents to open a 529 account to handle your college savings. it is assessed as parent asset with asset protection etc</p>
<p>By the time I file my FAFSA for next year, my account (without fin. aid funds) will probably be a little less than $2k. Will this affect my EFC a lot? Should my parents and I start a 529 now? Are there other benefits to setting up a 529? Will I be able to access it, or just my parents?</p>
<p>A $2K asset in the student’s name will only add $400 to your EFC vs. just over $100 if it’s assessed at the parent rate. Depending on what type of grants you’re eligible for, it may not make much of a difference or any at all. If you’re Pell eligible, or close to it, I would plan to use that money to pay first and second semester bills before filing FAFSA. If you are the owner of the 529 plan, you would have access to the funds. It’s not difficult to make withdrawals - mine has an online and telephone transfer system and they will use direct deposit if they have banking info on file. There is a minimum withdrawal amount ($100, I think) and a limit to the number of withdrawals per month and there are annual account fees (around $30) and, depending on the plan and the underlying investments, investment fees. Some states offer tax credits if you particpate in their 529 programs - not sure if that’s only for parents though, you’d have to do some research on the current programs/tax laws. Obviously, you would want to select one that has a fixed income or money market type of investment option.</p>