College financial aid FAFSA next Jan 1. What will they ask for?

[donkeyandshrek]

Locally, the amount of scholarship money is low and applicants are high. I'm beginning to feel like I will be in huge debt !

 

[MrEVILdrPorkchop2u]

Locally, the amount of scholarship money is low and applicants are high. I'm beginning to feel like I will be in huge debt !

Welcome to our world. We make to much to qualify for grants. (Insert rolling eyes here) We are just average middle class and this bugs me. We don't make 6 figures. DS took all college courses his senior year. This is his first year at college and I feel like I am a never ending checkbook. He is covered as far as tuition, but room and board, fraternity fees, and anything extra are on us. I wish we had all the money in the world, but we do not. FAFSA just makes me shake my head.

 

[ceecee]

It is so confusing....you need a master's degree to even fill out the appls. I don't remember any of this when I went to college. I didn't qualify for any grants because my parents made too much, so we didn't really pursue it I guess. My friend told me they made too much to get any need based scholarships and they don't make much. We will have to do our FAFSA this wkend. DD is already enrolled and accepted to our local state university which will save us a lot of $ especially if she can live at home the first two years. She did get an academic scholarship small but better than nothing. They told her with her ACT score she could skip several math and english classes. Which is good, she took an AC class in HS that we were told would be a college credit, but it wasn't at several colleges that she looked at.

 

[dminnie]

Do you know if they need bank statements for the year or just balances on Jan 1?

It just asked for current balances. It didn't specify a date. I filled it out on about Feb. 1st and just used the current balances of our accounts.

You should still fill out a FAFSA. Some schools require them to apply for school scholarships, which you can sometimes still get even if you don't qualify for grants or Stafford loans.

Everything I have heard is to fill it out even if you don't think you'll qualify for "needs" based aid. It isn't all that time consuming. I spent about an hour and a half, but most of that was just me looking for statements. If you just remember to put them all with your tax information for the year as you go along, you'll have it all together anyways. Then it would take maybe 45 min to 1 hour the first time.

I spent my "snow day" Tuesday filling out my tax returns and FAFSA forms. All I needed was info off the tax forms and bank account balances. It was much easier the second time than the first. You can also link your return to FAFSA but I had just efiled and it was too soon to link them

You do need more than just bank account balances. They need to know your income and assets. Income will come off of your tax return. It helps to have it done early so you can just take the numbers right off your finished return. You also need your assets: bank accounts, savings bonds, stocks you own, etc. You also need your child's assets and tax return(if they do a tax return).

Ok I filled this out today. I must have missed something. I just went through and nowhere did it ask me if I owned my home or owed money or what was in my accounts. Just what was in my daughter's. What did I miss. I just hit the next button when I finished a page. Should I go back in?

It goes through your child's assets first and then yours. Perhaps you missed the section for Parents. It only asks about any additional homes you own, above you primary residence. They don't look at the value of your primary residence, but they will look at the equity you have in 2nd and 3rd homes. They would only want to know if you owed money on a 2nd or 3rd home. No questions whatsoever about your primary residence.

Regarding your husband's 401K contribution: I think it is an EXCELLENT idea to put as much as you can in retirement savings. Although it does not affect your INCOME, it will not be counted as SAVINGS that you can tap into to help pay for your son's college.

It's been a while since my kids were in college, but that is the way it had been. Also, they consider savings accounts in the kids'names should be tapped into with a higher percentage than savings account of the parents.

You don't have to report retirement savings. That and your primary residence are not included in their calculations. So, if you're going to save the money(not intended as college savings), save it in retirement accounts. They don't ask about your primary residence at all...only additional homes you may own.

Just to double check, I don't do this until senior year, correct? Wasn't worried until I saw that scholarships are attached. Down here in Texas, we apply for college August 1st before his senior year and I want to be sure he doesn't miss any opportunities for some money help!!!

Making sure I don't miss anything. This whole thing is so confusing!!!

TIA,


K in SA

Yes, senior year after Jan. 1st.

 

[DVCcurious]

He already has a full ride to our local state college that he received from a math competition last year. He already said he doesn't want to go there. One of his current top five is MIT.

At the risk of being unpopular here is my advice. I graduated from an excellent state school (University of Washington) and years later I went to get an MBA at an excellent private school (Carnegie Mellon). Among my peers I went to the "worst" undergraduate school....by far. Most of my peers went to Chicago, Cornell, Virginia, Georgetown, Stanford...you get the idea. Now, there is nothing "wrong" with the University of Washington. It's a fine school. But it just doesn't measure up to Stanford.

Your son should go to the best school he can get into, regardless of anything else. The world is so damn competitive these days, and a the worst degree and GPA from MIT will be much better at landing him a job than the best degree and GPA from your state school (unless your state is Michigan or Virginia). Many students will have to get an advanced degree, and masters degree programs heavily weigh the quality of your undergraduate university. There aren't many Harvard MBAs who went to Penn State as an undergrad.


As for the FASFA here is what the deal is. You add back all retirement account contributions to your income to get your adjusted income, because you "could" have spent that on college rather than your retirement savings. Then they give you a housing/meals/clothing allowance. They deduct this allowance from your adjusted income. You are required to spend like 47% of this left over balance on college costs. They also look at all your assets and assume that some huge percentage should go to pay for college. However, 401k and IRAs are excluded from your assets.

So the strategy is to max your 401k while your kids are young, then min your 401k the 4 years before they get to college and save the money you were putting in your 401k in a 529 or just a regular brokerage account. The money you were putting in your 401k will just get added back to your adjusted income anyway so there's no point in increasing it near college age, but the money you put in years before is excluded from the FASFA asset form.

Good luck to your child and please remember my advice. The best college he can get into is the one he should go to. Your college is on your resume forever. You are judged based on your college forever. It's just the facts of life.

 

[tcherjen]

Have filled them out for DH and myself. Will be doing that for dd for upcoming fall term.

 

[tvguy]

At the risk of being unpopular here is my advice. I graduated from an excellent state school (University of Washington) and years later I went to get an MBA at an excellent private school (Carnegie Mellon). Among my peers I went to the "worst" undergraduate school....by far. Most of my peers went to Chicago, Cornell, Virginia, Georgetown, Stanford...you get the idea. Now, there is nothing "wrong" with the University of Washington. It's a fine school. But it just doesn't measure up to Stanford.

Your son should go to the best school he can get into, regardless of anything else. The world is so damn competitive these days, and a the worst degree and GPA from MIT will be much better at landing him a job than the best degree and GPA from your state school (unless your state is Michigan or Virginia). Many students will have to get an advanced degree, and masters degree programs heavily weigh the quality of your undergraduate university. There aren't many Harvard MBAs who went to Penn State as an undergrad.


As for the FASFA here is what the deal is. You add back all retirement account contributions to your income to get your adjusted income, because you "could" have spent that on college rather than your retirement savings. Then they give you a housing/meals/clothing allowance. They deduct this allowance from your adjusted income. You are required to spend like 47% of this left over balance on college costs. They also look at all your assets and assume that some huge percentage should go to pay for college. However, 401k and IRAs are excluded from your assets.

So the strategy is to max your 401k while your kids are young, then min your 401k the 4 years before they get to college and save the money you were putting in your 401k in a 529 or just a regular brokerage account. The money you were putting in your 401k will just get added back to your adjusted income anyway so there's no point in increasing it near college age, but the money you put in years before is excluded from the FASFA asset form.

Good luck to your child and please remember my advice. The best college he can get into is the one he should go to. Your college is on your resume forever. You are judged based on your college forever. It's just the facts of life.

I'm not convinced that going to the "best" school is helpful. Your work, your work ethic, networking, your reputation, your body of work and common sense make a bigger difference.
There is a HUGE difference between book knowledge and the University environment, and practical knowledge and the real world environment.
And folks with their Masters seem to be at the worst at dealing with that fact that how they learned to do things in University, isn't how it is done in the real world.
Example, one of our reporters with his masters couldn't track down someone for an interview. They went on Lexus Nexus, the google, and White Pages....nothing. Half an hour of work, nothing. Our reporter, who has just an AA, picked up the 2008 phone book we have sitting on the desk, and in 20 seconds had that person's old disconnected phone number, and the address it was listed at. Which is the address the person still lived at it turns out.
There is a big difference between highly educated and being able to think.

 

[StephMK]

Regarding your husband's 401K contribution: I think it is an EXCELLENT idea to put as much as you can in retirement savings. Although it does not affect your INCOME, it will not be counted as SAVINGS that you can tap into to help pay for your son's college.

I agree with that. While it still shows as annual income, it does not get counted when they look at your savings. I don't think the FAFSA is too terrible. Not much different than a tax return and after the first year, it's much easier. But then, we have one home and nothing out of the ordinary to add a lot of work either.

 

[tvguy]

I think the 500 pound Gorilla in the room in this thread is, the time to think about college is when your child is born, not their Junior or Senior year of college.
Even if it is only $100 a month, save it now.
We had one Grandma that gave our kids like $1100 worth of junk for their birthdays and Christmas every year, and another Grandma who gave $100 in junk and a $1,000 savings bond (which cost half their face value) for their birthdays and Christmas. Both kids had $36,000 each just in savings bonds when they hit college. DS's tab with room and board came to $200,000 for 5 years of private university, and DD, with one semester left, over 5 1/2 years will end at right about $50,000, in Public University, including all costs associated with studying overseas for last semester and this semester.

 

[rockawaybeachgirl]

I agree with that. While it still shows as annual income, it does not get counted when they look at your savings. I don't think the FAFSA is too terrible. Not much different than a tax return and after the first year, it's much easier. But then, we have one home and nothing out of the ordinary to add a lot of work either.

Just to clairfy - this is true for every year UP UNTIL the 'base year' used for determining financial aid, which is Jan1 of the student's junior year until Dec 31 of the senior year. Contributions to a 401k made in this period are added back to the income of the year for the purposes of determining aid, because, as someone said upthread, that money could have been set aside in college savings. Unfortunately this results in the aid picture looking like you have access to that money when you've locked it up in the retirement account.

 

[3boymthr]

It just asked for current balances. It didn't specify a date. I filled it out on about Feb. 1st and just used the current balances of our accounts.


Everything I have heard is to fill it out even if you don't think you'll qualify for "needs" based aid. It isn't all that time consuming. I spent about an hour and a half, but most of that was just me looking for statements. If you just remember to put them all with your tax information for the year as you go along, you'll have it all together anyways. Then it would take maybe 45 min to 1 hour the first time.



You do need more than just bank account balances. They need to know your income and assets. Income will come off of your tax return. It helps to have it done early so you can just take the numbers right off your finished return. You also need your assets: bank accounts, savings bonds, stocks you own, etc. You also need your child's assets and tax return(if they do a tax return).



It goes through your child's assets first and then yours. Perhaps you missed the section for Parents. It only asks about any additional homes you own, above you primary residence. They don't look at the value of your primary residence, but they will look at the equity you have in 2nd and 3rd homes. They would only want to know if you owed money on a 2nd or 3rd home. No questions whatsoever about your primary residence.


You don't have to report retirement savings. That and your primary residence are not included in their calculations. So, if you're going to save the money(not intended as college savings), save it in retirement accounts. They don't ask about your primary residence at all...only additional homes you may own.



Yes, senior year after Jan. 1st.

No No, not after January 1st - do it ON January 1st. I attended a financial aid seminar with a financial aid advisor from Harvard. His advice get it done ASAP "sit at the computer and do the FAFSA as soon as you wake up on New Years". They look at these forms on a first come first serve basis - even if the numbers are subject to change. He said "the longer you wait the less apt you are to get need based aid, there is only so much money to go around and once it's gone it's gone. Even if you make less money than someone else if that person got in line two months before you and they meet the guidelines they'll get the money and you won't." Don't worry about having all the 100% correct numbers at hand. Go onto the site, have your taxes from the prior year available, and unless that number has changed Significantly just use those numbers. Then, after you have done your taxes go back and amend the FAFSA.

 

[TLuvsD]

Our D is a sophomore in college...so we've been doing the FASFA for a few years. And the CSS Profile (she attends a private school). Go to the library or your bookstore and gat a copy of "Paying for College without Going Broke". Clear, easy directions for the FASFA and the Profile. It's worth every penny (annual editions about $15).

Colleges see three streams of income for payment: current earnings, savings and future earnins (ie loans). There can be a LOT of difference in what a state school offers and what a private school offers.

If you have a top tier student, check out the Automatic Full Tuition/Full Rides discussion in the Financial Aid and Scholarship section of College Confidential. There is also a discussion on competitive scholarships.

Pay attention to your financial decisions during high school. Make any adjustments by Jan 1 of Junior year (or now if you haven't already).

Try to keep your student from falling in love with any ONE school. It leaves your options open to decide after the admissions wait and the wait for scholarship/financial aid information.

 

[floridafam]

Thank you. I will pick up that book and take a look at College Confidential.

We toured Michigan over the summer while we were on vacation and he hated it. It's a good thing we toured because he really thought he would like to attend there.

I keep reading that the Ivy League schools will meet your financial needs if you are accepted and your parent's income is below certain levels. Does anyone know exactly what that means?

Nothing is out of the question at this point. He wants to look at state schools and the Ivy League schools. He wants to go where he's going to be happy.

I am home with our little one. She's special needs and I school her at home. DH works very hard and we do okay but are not wealthy and have to sacrifice a lot so I cdm stay home. DS is currently first in his class and did well in the PSAT and SAT. I hope that helps him at least a little.

 

[3boymthr]

Thank you. I will pick up that book and take a look at College Confidential.

We toured Michigan over the summer while we were on vacation and he hated it. It's a good thing we toured because he really thought he would like to attend there.

I keep reading that the Ivy League schools will meet your financial needs if you are accepted and your parent's income is below certain levels. Does anyone know exactly what that means?

Nothing is out of the question at this point. He wants to look at state schools and the Ivy League schools. He wants to go where he's going to be happy.

I am home with our little one. She's special needs and I school her at home. DH works very hard and we do okay but are not wealthy and have to sacrifice a lot so I cdm stay home. DS is currently first in his class and did well in the PSAT and SAT. I hope that helps him at least a little.

This will help you a lot a some schools not so much at others. Know your market and what it takes to get into the schools you are applying to.

You mentioned MIT. A good friend went to MIT. He said that 99% of the American kids who went there were first in their class and had top SAT and PSAT scores and most of them have 5 or 6 or more AP classes under their belt and some have college classes. (Keep in mind a large portion of the students were from other countries.) He is a member of the alumni network there and said what helps kids to get in (never mind get scholarships) is working in the field they are interested in before they get to the point of applying, they've done summer programs in their field and they know exactly what they want to study and what they want to do with what they are studying and they are a well rounded student with activities other than just being a good student such as drama club or band or track as well as some sort of civic or religious organization that promotes volunteering in the community and the kids who get money are either very underprivileged or just off the charts on the genius level.

OTH - if your DS is interested in a school where most of the kids who apply have an average GPA of 3.0 to 3.5, SAT scores of 1700 and most are undeclared and your DS knows he wants to study math and knows what he wants to do with his degree, has a GPA of 3.8 to 4.0 and SAT scores of 2000+ there is a very good chance he'll not just get in he'll get a great scholarship and more.

 

[floridafam]

Thank you.

He did get some information today about summer program scholarships from something with quest in the name. I still have to read it. He has mail from hundreds of schools. That started rolling in after he took the PSAT last year. I wish all of the envelopes had money in them. lol

He received a flyer for summer studies at Harvard. $10,000! We can't afford that. He dies everything he can to volunteer and such. That is mandatory for the IB program.

He has no idea what he wants to do. He's thinking something in the STEM field or math but he doesn't really know yet.

I guess we won't truly know until we find out about money and it might come down to that.

 

[3boymthr]

Thank you.

He did get some information today about summer program scholarships from something with quest in the name. I still have to read it. He has mail from hundreds of schools. That started rolling in after he took the PSAT last year. I wish all of the envelopes had money in them. lol

He received a flyer for summer studies at Harvard. $10,000! We can't afford that. He dies everything he can to volunteer and such. That is mandatory for the IB program.

He has no idea what he wants to do. He's thinking something in the STEM field or math but he doesn't really know yet.

I guess we won't truly know until we find out about money and it might come down to that.

Summer programs are great but, I agree, expensive! Our friend's suggestion for another friend's child who was interested in applying at MIT, but also couldn't afford the summer programs, work either in an internship or other beginner position that was totally or even remotely in his field. He suggested looking for one that was either unpaid or paid a small stipend to cover the cost of clothing, food and transport. Say for example your DS wants to be an engineer. He could apply at an engineering firm in the area to be a data entry person, etc. If he wants to study math, he could volunteer to help at his school assisting teachers with summer math programs, tutoring other kids, etc. He could also apply to be a counselor in training at a summer camp that teaches STEM programs to younger kids. This is good experience not just for schools like MIT but all other schools as well.

 

[imsayin]

I keep reading that the Ivy League schools will meet your financial needs if you are accepted and your parent's income is below certain levels. Does anyone know exactly what that means?

Go to one of their websites and look for the financial calculator. Every school has them. You can put in your financial info and it will tell you what you would be expected to pay at their school.

 

[crisi]

Thank you. I will pick up that book and take a look at College Confidential.

We toured Michigan over the summer while we were on vacation and he hated it. It's a good thing we toured because he really thought he would like to attend there.

I keep reading that the Ivy League schools will meet your financial needs if you are accepted and your parent's income is below certain levels. Does anyone know exactly what that means?

Nothing is out of the question at this point. He wants to look at state schools and the Ivy League schools. He wants to go where he's going to be happy.

I am home with our little one. She's special needs and I school her at home. DH works very hard and we do okay but are not wealthy and have to sacrifice a lot so I cdm stay home. DS is currently first in his class and did well in the PSAT and SAT. I hope that helps him at least a little.

The financial aid package for an Ivy depends on the Ivy. You'll need to look. I have a friend whose son when to Stanford (not an Ivy, but Ivy level of difficulty and Ivy financial aid package), and they didn't get a penny - they made too much money as a family. Middle class families go to Stanford for free - for definitions of middle class that are a family income less than $100k. Two parents working can push you over that easily.

What didn't he like about Michigan? Because visiting a campus should not only tell you about that campus - but about others. Michigan is cold and the winters are long - but MIT also has lousy weather (Stanford is cool, but the winters are just cooler than the summers ).

Also, make sure he has safety schools he will actually attend. My son's friend did not get into MIT, despite being a state high school Science fair winner, a nationally ranked concert violinist, a nationally published photojournalist, who shared valedictorian honors and aced his SATs. My cousin did not get into Princeton (she did get into Vassar) speaking four languages fluently, having done extensive volunteer work, having nationally published short stories, and graduating at the top of her class from Brooklyn Latin. There are more exceptional kids than slots for these schools, and having the perfect resume to get in does not mean you will get in. Another friend has a daughter who chose a safety school she had no desire to go to, and a bunch of stretch schools...and she didn't make it into any of her stretches, so she ended up taking a year off to revisit her college decisions.

Finally, even if he does get in, prepare him for not setting his heart on a school that doesn't offer the best financial aid package. My cousin is paying through the nose for Vassar, but could have gotten a free ride at a dozen schools with less cache. For them, they decided that the reputation of Vassar was worth the loans.

 

[ruadisneyfan2]

Thank you. I will pick up that book and take a look at College Confidential.

We toured Michigan over the summer while we were on vacation and he hated it. It's a good thing we toured because he really thought he would like to attend there.

I keep reading that the Ivy League schools will meet your financial needs if you are accepted and your parent's income is below certain levels. Does anyone know exactly what that means?

Nothing is out of the question at this point. He wants to look at state schools and the Ivy League schools. He wants to go where he's going to be happy.

I am home with our little one. She's special needs and I school her at home. DH works very hard and we do okay but are not wealthy and have to sacrifice a lot so I cdm stay home. DS is currently first in his class and did well in the PSAT and SAT. I hope that helps him at least a little.

Princeton is 100% need-based with a no loan policy. Nothing is based on merit and everyone graduates with 0 debt. Their alumni are extremely dedicated and there is a ton of research money available to students for independent study.
My ds is a HS junior, average kid so he won't be applying to Princeton but he is attending a week long overnight computer camp there this summer which got me looking at Princeton's website, maps, etc. It's a beautiful campus and I even look forward to just walking around & taking pictures.

 

[DVCcurious]

I'm not convinced that going to the "best" school is helpful. Your work, your work ethic, networking, your reputation, your body of work and common sense make a bigger difference.

You're totally right.

In fact, when McKinsey or Goldman Sachs gets a stack of resumes for summer internships for juniors the first question they ask isn't "what school is this student attending", instead they ask "what is this person's work ethic and their common sense"?

That's why Goldman Sachs has such a diverse work force, with employees from schools like Harvard and Yale but also East Florida Tech and Southern Wyoming University.

The school you attend really doesn't matter one bit. Every single company recruits at all 5000+ universities in this country. If you want to work for Google you have the same chance attending MIT as you do attending Wayne State University.

Please. Join us in the real world.

Your undergraduate university matters MUCH MORE than any other factor you've listed. My guess is you've never recruited for a top-tier company or you've never attended a top-tier school and tried to compete for top-tier jobs. As someone who was told over and over "Carnegie Mellon is a fine school, with a great MBA program, but we only recruit from the top 10" I can tell you that your school matters much more than any other factor.

I went to University of Washington for undergrad and I got a job at PricewaterhouseCoopers out of school. PwC hired 20 people from University of Washington and 1 person from Washington State University. 20 vs 1. You want to tell me the quality of school doesn't factor in to PwC's recruiting decisions?

The guy with the worst GPA at MIT will have many more job offers at much higher salaries at much better companies than the guy with the best GPA at Washington State University.