<p>Sorry if this is confusing, I don't fully understand the situation myself. So retirement funds for parents don't count towards EFC, correct?
My dad is self employed, and instead of saving for his retirement in a fund he had bought real estate his whole life. This means he has considerable assets, so our EFC is full cost even though our income is about 120k a year. So basically his real estate is his retirement fund, is there any way to explain this to colleges?</p>
<p>You can explain but be prepared if they don’t see it the same way as you do. We also have a significant portion of our retirement income in real estate…and it’s been considered an asset in our experience.</p>
<p>Same boat here. Our real estate is a good part of our retirement plans. </p>
<p>It wasn’t something that we thought about (financial aid wise), but once we learned that schools will consider those assets as “available to pay for college,” we knew that we’d never qualify for aid. </p>
<p>Schools aren’t going to give an exception because people can put ANY amount that they want into Real Estate and then call it “retirement”. </p>
<p>Our children accepted merit scholarships at their university. </p>
<p>BTW…even with an income of $120k and modest savings, you wouldn’t qualify for much aid anyway…except at HYPS - which give super aid. At the other schools, you’d likely be expected to pay $35k+ with the rest likely in student loans and work-study and maybe a small grant.</p>
<p>Edited to add…</p>
<p>From another thread…</p>
<p>Okay, so my family makes about 130,000 a year, and so my EFC on every financial aid calculator is the full cost. The problem, however, is that my parents can only afford 13,000 a year. If I apply ED to Amherst College,</p>
<p>You have to be realistic. Amherst will not be affordable. If you have the stats for Amherst, then you have the stats for large merit elsewhere. </p>
<p>You need to accept reality and put your efforts into finding affordable schools that will give you merit aid.</p>
<p>To be excluded from FA calculations the funds must be in an official retirement fund such as an IRA or 401K. This is because the government encourages people to save for retirement using these type of retirement vehicles by giving tax breaks, excluding the assets from FA calculations. No school is going to make an adjustment for this. .
</p>
<p>At most schools an income of $120,000 would make you full pay anyway. For FAFSA an income of $120k would make your EFC close to 30,000 even without assets.</p>
<p>You CAN buy real estate using the IRA, SEP, 401K or Define Benefits funds. But if the real estate is bought using the after tax money, you are out of luck.</p>