Moving $200,000 out of cash to improve chances for college financial aid?

[Anonymous]

You are lucky not to NEED financial aid. You don't have to deal with filling out any of the forms. Stop the gamesmanship. You already won the game! You have money.

[Anonymous]

You’re not going to get FA with an income that high. It doesn’t matter what you do with that money.

[Anonymous]

Please leave the financial aid to those who truly cannot afford college. You have the resources to pay, so pony up!

[Anonymous]

The financial aid the NPC is telling you that you qualify for ends up being loans and on campus work. Happened to my brother who has 4 kids (1 in college), HHI $180K, average savings. His DD "qualified" for aid according to NPC and it was loans and work programs.

[Anonymous]

1. you cannot just put $200K in a retirement account; there's a limit to how much you can contribute
2. if you put it into a 529, when you withdraw it, it has to be for college expenses. If not, you will get taxed. Regardless, colleges will look at 529 amounts.

[Anonymous]

Anonymous wrote:The financial aid the NPC is telling you that you qualify for ends up being loans and on campus work. Happened to my brother who has 4 kids (1 in college), HHI $180K, average savings. His DD "qualified" for aid according to NPC and it was loans and work programs.

The OP’s kids won’t qualify for work study.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I don’t think it will matter. You have to be pretty low income to get FA these days. Otherwise you’re looking at loans, and do you really want that.

"Low-income" as in making under $200,000 per year—you know, the 88th percentile of household income in this country. I see you're very in-tune with the average American.

It’s not so much income as assets. We have about $180k HHI but our home has gone up more than 40% in value to about $1million and we have a good chunk of retirement and savings. We don’t qualify for FA. Nor should we; that’s what we were saving *for*. We can’t afford a $90k school but we can afford $50-60k. Kid is a very strong candidate and will also be applying to schools a couple tiers below what they could get into in hopes of some merit aid. Then we’ll just weigh options. Kid is well aware of the finances so that they keep it in mind when thinking about schools and there are no surprises for them.

[Anonymous]

This is the funniest thread.

OP doesn’t want to use their $200k. Cry me a river.

[Anonymous]

"We originally kept the $200,000 [cash] as an emergency fund,"

How are people this dumb this rich

[Anonymous]

Did you run the NPC with that $ in 529s? I don’t think that will help you. Schools will assume that 100% of 529 money is available.

Your only options are cramming the max allowable into retirement (accepting the loss of liquidity) and paying off any debt. If you owe money on cars, that’d be the first place I’d look.

[Anonymous]

Anonymous wrote:1. you cannot just put $200K in a retirement account; there's a limit to how much you can contribute
2. if you put it into a 529, when you withdraw it, it has to be for college expenses. If not, you will get taxed. Regardless, colleges will look at 529 amounts.

And - doesn't the NPC still count the retirement and 529 as assets? I find it very hard to believe that shifting savings from cash/stocks to retirement and college savings instruments (IRA/529) make a difference. (minus maybe the person who recommended life insurance above...?)

The benefit of a 529 isn't to hide money but to get nontaxable gains over time. I see no benefit to dumping cash into the 529 for kid who is about to go to college (unless it were a scenario where gifted grandparent money could still grow over time for something like med school or law school - but this isn't that scenario).

As far as your retirement is concerned - given your large amount of cash stocks....if you aren't maxing out on what you can contribute at work to 401K/TSP/etc ($23K + $7.5K if old enough for catch up). I'd start doing that max for both workers. And speak to your accountant about whether you can contribute to a max to IRA's.

[Anonymous]

Anonymous wrote:Our HHI is $300k. I know you all say that doesn't qualify us for aid, but that's not what the NPC says. According to the NPC we can get some aid by eliminating our cash.

Good luck with that. Our HHI is 158k. We received zero FA. Merit aid is still available.

[Anonymous]

Anonymous wrote:Our HHI is $300k. I know you all say that doesn't qualify us for aid, but that's not what the NPC says. According to the NPC we can get some aid by eliminating our cash.

I just find this very hard to believe. They care about the total of all your liquid/semi-liquid assets....not how you currently hold them.

[Anonymous]

Anonymous wrote:Please leave the financial aid to those who truly cannot afford college. You have the resources to pay, so pony up!

We'll already be paying $80,000. We're just trying to get some help for the remaining $10,000. We can barely afford the $80,000 but we're doing our best to make it work.

[Anonymous]

Anonymous wrote:Our HHI is $300k. I know you all say that doesn't qualify us for aid, but that's not what the NPC says. According to the NPC we can get some aid by eliminating our cash.

Our income was 2/3 of that and the only aid my children received was the lower cost loans. No grants or need based scholarships.