<p>sblake7 and dt123, I realize you guys are absolutely right. I didn't understand before, but here's what your saying: Records will show you had 500 dollars in interest from the bank, but you have nothing in the bank, which will obviously be incongruous, so it will definitely be checked out by the IRS ? What if you withdrew that 10,000 from the account and actually DID spend 5,000 of it, thereby leaving only 5,000 in assets/cash, that wouldn't be considered fraud right there, would it? I mean, technically you spent some of it and only a portion is left.</p>
<p>Right. It's your money-- you can spend it as you wish. Just keep records in anticipation of the questions that may come from the Financial Aid officers.</p>
<p>Do consider looking into converting the assets to 529 accounts, though-- that way they can be sheltered from FAFSA calculations, and still be available for college (to repay loans, for example).</p>
<p>Your earlier questions seemed to be centered on "will they be able to catch me if I......" commit fraud, rather than on looking for legitimate ways of maximizing aid.</p>
<p>thanks sblake7 ........ 1) Ok, again, so basically, on the FAFSA they're looking for assets and cash, liquid or not, and if it is indeed in liquid (ie. under a mattress), it MUST be reported, correct ? Seems fair enough, I mean, it would be unfair to portray yourself as really poor if you have a lot of money hidden somewhere. 2) Is the cutoff for parent contributions around 40,000+ in assets ? ..... and finally, sorry for constantly using the "under the mattress" example, not trying to sound fraudulent or anything, lol. Also, 1) in your opinion/experience, do school counselors have good advice/experience about money matters and the FAFSA ?</p>
<p>"on the FAFSA they're looking for assets and cash, liquid or not, and if it is indeed in liquid (ie. under a mattress), it MUST be reported, correct ?"</p>
<p>FAFSA considers ASSETS, and INCOME. Both of the Student, and the Parents.</p>
<p>Regarding ASSETS-- it asks for checking, savings, cash, investments, bonds, stocks, and the like, but specifially exempts tangible assets (primary home, cars, computers, stereos), and most retirement accounts (IRA's, 401K's). Effective this year, some 529 college savings accounts are exempted as well.</p>
<p>"...it would be unfair to portray yourself as really poor if you have a lot of money hidden somewhere."</p>
<p>Right. BUT, there are legal and ethical strategies that families can use to shelter assets-- so it's not only the poor that are eligible for need based aid. For example, a family can own a million dollar home, and have several hundred thousand dollars in retirement accounts, own several luxury cars outright, and have $45,000 in their checking account, and NONE of that will count against them in terms of financial aid (talking basic FAFSA formulas here-- schools that require Profile are different). Home equity isn't considered, retirement accounts aren't considered, tangible assets (cars) aren't considered, and the Asset Protection Allowance typically allows up to about 45K in checking/savings assets before a dime gets counted. So planning ahead makes sense.</p>
<p>"Is the cutoff for parent contributions around 40,000+ in assets ?"</p>
<p>Parents get an Asset Protection Allowance, the student does not. Typically around 45K in liquid assets, but depends on number in the family and the age of the older parent. Use the financial aid calculator at FinAid and it will tell you your APA. Liquid assets below that amount won't be considered in calculating the EFC-- only about 10% of families have over the APA and get assessed for parent's assets. Typically, most of the EFC comes from parent's income, and student's assets. </p>
<p>"in your opinion/experience, do school counselors have good advice/experience about money matters and the FAFSA ?"</p>
<p>I don't have much experience with school counselors, and no experience with them on money or FAFSA matters. My guess is that few have a good understanding of how FAFSA calculates EFC, or even what an EFC is. I suggest that parents approaching this topic get a current book and educate themselves. I like "Paying for College Without Going Broke" by Princeton Review; that's how I started learning. But there are others.</p>
<p>thanks ! 10chars</p>
<p>So are student calculated into EFC or is it considered a student contribution?</p>
<p>EFC is the Expected Family Contribution. Total Cost of college minus EFC = value of aid package for colleges that meet 100% of need. Aid package includes grants, loans, and work study.</p>
<p>EFC is the sum of Parent's EFC + Student's EFC. EFC is based on a % of Student's assets + % of student's income (over about 2,600) + % of parent's assets over the asset allowance + % of parent's income over the income allowance.</p>
<p>As a different matter, many privates expect the student to contribute a fixed amount toward the cost of college as 'self help'.</p>
<p>What about the CSS profile! How do they look at assets? Would Pr be a good source as well?</p>