This discussion was created from comments split from: Looking for a great fit LAC.
Have a question that may be better posted in another thread but I figured since so many knowledgeable people are reading and responding to this thread that I thought I would throw it out there.
Do parents have to process a fafsa for every their child is in college and could the parent contribution, and therefore the FA package change, year over year based on changes in the parents income.
my concern is that if the initial FA seems affordable with limited parental contribution will that contribution change as a parent makes more money?
What if 1st year FA reflects low earnings but the situation changes (raise, more houirs, increased business etc) could a parent find themselves in a situation where they are responsible for more money whether straight out of pocket or through plus loans??
Anyone with thoughts/experience with this situation?
Yes, every year, and if the finances change, the FA can change.
However, one school I am aware of promises the same cost (financial aid/tuition) all 4 years - Northeastern. I hadn’t heard of that before or since, and my D’s package has changed slightly each year.
Do bear in mind financial aid is calculate don prior-prior year, so if your kids was starting college this fall FA would be based on 2016 income, then sophomore year on 2017, etc.
Merit awards typically do not change unless the minimum GPA is not met.
@Cornellian88 I believe you fill those forms out every year. If your circumstances change then your aid amt could change.
@Cornellian88 - yes, you have to submit a FAFSA every year. If you are admitted at a meets full need school, and based on your information receive a substantial amount of need-based aid, and if your financial situation changes for the better, this will impact future need-based aid.
Because the FAFSA is based on prior income (for example, the 2018-2019 aid year will be based on 2016 earnings) you will know if advance if an increase in income will impact future need-based awards.
Thanks @college_query so it would make sense to run the 2017 earnings in the NPC to see how much it changes based on the difference in 2016 earnings. Does this typically impact the parent contribution?
For schools that meet full need, generally if there’s more income, then there will be less need. But it’s not universally true. For example, an increase from $20,000 to $25,000 annual income will still result in an EFC of 0.
Even if the tuition isn’t locked in for 4 years, it shouldn’t make a difference at lower income levels. The institutional grants will most likely increase with it, unless the school is facing financial issues, which could be the case with large endowment schools under the new tax plan, speculation on my part…But I anticipate as my income goes up my family contribution will also go up regardless of what happens with COA.
But as someone mentioned above, an increase from 20 to 24,000, I think that’s the magic number, isn’t going to change anything for me. It might if I started to earn 70,000, but even at that income my net price doesn’t really change that significantly at most of the schools.
I would have some contribution for sure but it’s not as much as I thought it would be. And for me I want to be able to contribute, this feels kind a yucky as a parent.
The FAFSA has to be submitted every year, but a few school do not require the CSS after the first year.
Grinnellhopeful will also have another child starting school, and while the EFC can’t go only lower than $0, if income increases that second child will probably keep the EFC pretty low.
Our income went up from 2016 to present. I am assuming our EFC is going to be higher next year, seems only logical.
And the opposite is true. If your income decreases, if you become unemployed, if a parent dies, if you lose your house in a fire … your fa will likely increase.
Tuition and fees and housing costs increase by several % every year.
Except at schools that freeze these for four years.
The student can take a slightly larger student loan in sophomore, junior and senior year.
If the aid is based on FAFSA, the EFC formula usually changes every year, to reflect a slightly higher income protection allowance for parent and student, and parent asset protection allowance (a few years ago APA actually decreased sharply).
If the aid is based on CSS profile, and if they consider home equity in their calculation, then aid might go down as your parents pay off their house, and home equity increases.
We have two in college next year, so our EFC is much lower. But in later years, with only one in college, at private schools we would get less need based aid, so I ran net price calculators with one and two in college to see how aid might change.
Only at colleges that guarantee to meet full need for all.
Certainly the listed issues here are financial crises…but at schools that don’t meet full need, while you might see an increase in aid…it might not be a huge one.
As an example…when our first kid was in college, his family contribution exceeded the cost of attendance. When he was a college senior, his sister also was in college. The family contribution became less than half of,the cost of attendance…$22,000 on a COA of about $48,000 at the time. His need based aid didn’t increase one dime…not one. But his merit award went up $250. Every penny counts.