S/o don't financial aid offices penalize families who are capable of saving but who choose not to?

[Anonymous]

OP, most of the posts above about colleges not being able to tell the unwilling to save from the unable to save is true. And that's a good thing, really. Remember income has a much bigger effect on financial aid most places.

What's a total myth (you'll be happy to know) is the idea that those don't don't save are better off when paying for college than those that do. Not only is that untrue, it's a pretty stupid idea, right?

So not only will you have the moral high ground when you save, your kid will actually be able to attend college, while those that try and beat the system will be comforted by the knowledge that the lucky poors didn't beat them out of anything.

Of course their kid won't actually BE at college, but they'll think they won anyway!

[Anonymous]

And it's now prior, prior year income and many of the private schools also ask about prior year and current year income and assets, so sure you could decide to temporarily "fake" a lower income, but you would then have to do that for 6 years per child. At that point the lower income would likely become "real." And people overestimate what that will really save you maybe 5-10k yr at best. Not saving when you have a high income rarely pays off--maybe if you have 2-3 kids in college at schools that cost 80k and no merit aid.

We have a HHI of 100k and about an EFC of around 34k. So we don't qualify for need-based aid outside of loans for in-state publics, but we do qualify for need-based aid at private schools that meet full need. IME the merit aid packages beat out the need packages at these anyways--since the need ones expect quite a bit of loans.

Quite honestly, the 34k is exactly what I feel capable of paying--it's definitely a stretch and requires sacrifices but not to the point where I would say no to my kid's first choice college on the basis of the finances--so I think financial aid offices are good at their job.

[Anonymous]

State schools really don't have much money to give unless you are eligible to receive the Pell Grant. Private schools can offer more money, but they cost more money. A $20 scholarship will still mean you have a $50K tab.

Beware of the parents who claim they only have to pay X amount. That amount could be their tuition bill, but the student has loans in the name of Stafford. I am always amazed at the parents who do not read/understand their child's financial statement.

A pp mentioned that every school financial aid is different. The Net Price Calculator for each school is the best use of your time to calculate your cost. Costs can be impacted by the number of students in college at one time. For the most part, financial aid is based on income not savings.

[Anonymous]

Anonymous wrote:And it's now prior, prior year income and many of the private schools also ask about prior year and current year income and assets, so sure you could decide to temporarily "fake" a lower income, but you would then have to do that for 6 years per child. At that point the lower income would likely become "real." And people overestimate what that will really save you maybe 5-10k yr at best. Not saving when you have a high income rarely pays off--maybe if you have 2-3 kids in college at schools that cost 80k and no merit aid.

We have a HHI of 100k and about an EFC of around 34k. So we don't qualify for need-based aid outside of loans for in-state publics, but we do qualify for need-based aid at private schools that meet full need. IME the merit aid packages beat out the need packages at these anyways--since the need ones expect quite a bit of loans.

Quite honestly, the 34k is exactly what I feel capable of paying--it's definitely a stretch and requires sacrifices but not to the point where I would say no to my kid's first choice college on the basis of the finances--so I think financial aid offices are good at their job.

Completely agree, giving up six years of income for a little more FA is always going to be penny wise pound foolish. There's just no way that's a financial win, and most people are not at a good age to re-start a career when their kids graduate college.

[Anonymous]

Aid is all calculated by standard algorithms using individual family information. It is nothing personal. Everyone is held to the same standard via the math.

[Anonymous]

^^standard algorithm for each school. Also algorithms are tweaked every year at some schools. So in reality it all varies, school to school and year by year. We received FA offers from 10 different schools, same inputs on applications.

[Anonymous]

Anonymous wrote:And it's now prior, prior year income and many of the private schools also ask about prior year and current year income and assets, so sure you could decide to temporarily "fake" a lower income, but you would then have to do that for 6 years per child. At that point the lower income would likely become "real." And people overestimate what that will really save you maybe 5-10k yr at best. Not saving when you have a high income rarely pays off--maybe if you have 2-3 kids in college at schools that cost 80k and no merit aid.

We have a HHI of 100k and about an EFC of around 34k. So we don't qualify for need-based aid outside of loans for in-state publics, but we do qualify for need-based aid at private schools that meet full need. IME the merit aid packages beat out the need packages at these anyways--since the need ones expect quite a bit of loans.

Quite honestly, the 34k is exactly what I feel capable of paying--it's definitely a stretch and requires sacrifices but not to the point where I would say no to my kid's first choice college on the basis of the finances--so I think financial aid offices are good at their job.

Just curious what your net income is each year. How much do you actually bring home yearly?

[Anonymous]

Anonymous wrote:

Anonymous wrote:And it's now prior, prior year income and many of the private schools also ask about prior year and current year income and assets, so sure you could decide to temporarily "fake" a lower income, but you would then have to do that for 6 years per child. At that point the lower income would likely become "real." And people overestimate what that will really save you maybe 5-10k yr at best. Not saving when you have a high income rarely pays off--maybe if you have 2-3 kids in college at schools that cost 80k and no merit aid.

We have a HHI of 100k and about an EFC of around 34k. So we don't qualify for need-based aid outside of loans for in-state publics, but we do qualify for need-based aid at private schools that meet full need. IME the merit aid packages beat out the need packages at these anyways--since the need ones expect quite a bit of loans.

Quite honestly, the 34k is exactly what I feel capable of paying--it's definitely a stretch and requires sacrifices but not to the point where I would say no to my kid's first choice college on the basis of the finances--so I think financial aid offices are good at their job.

Just curious what your net income is each year. How much do you actually bring home yearly?

With 2 kids, after taxes and other contributions our net income is just under 75k/yr. We have saved for both kids' college regularly since they were born so we have just about 100k in 529 plans with the eldest starting this year (our kids don't overlap in years in college which would give us a big benefit in FA). I believe our EFC would have been closer to 30k without the savings, but glad we have it. We generally keep to a 4500-5000 mo budget, so that gives us around 20k to cash flow to college, and we draw down the remainder from savings, around 15k. So Child 1 will use up about 60k of the savings, which seems proportionate to age. DC is going to a tuition freeze school.

[Anonymous]

It depends. The primary driver of how much aid you get is your income. So, if you have high income and it’s all W-2, it’s practically impossible to game the system. If you are self employed/own a business, there is some wiggle room on your end, but there is also some wiggle room on the colleges’ end too, e.g. they can review your income tax filings and decide to add some of the deductions back to your income.

The reason you see people who live in expensive houses getting aid is because you have no idea what’s behind that house. For all you know, there might be very little equity or they might not even own the house - the grandparents purchased it for them. Or, these people might be cheating on their taxes as well, in which case they are setting themselves up for bigger problems.

[Anonymous]

OP, I think you are under the impression that all of these families have made this amount of money for an extended period of time. Us, and nany people we know in this situation have only been making 150K+ for a few years.

[Anonymous]

Income is a much bigger factor than assets in the financial aid formulas, and parents are expected to use a relatively small percentage of their non-retirement assets (about 6% of assets each year). As others have said, deliberately not saving is a poor strategy. It is good to keep assets out of the student's name, however. They are expected to contribute much more heavily from accounts in their own name (and from any income that they earn.)

[Anonymous]

OP, the problem with your question is -- how far back do you go? How do you judge someone's career and life choices to figure out what they *should* have made? What if they have a high salary now, but were paying off college and professional school loans for many years because they put themselves through undergraduate and law school, for example? What if that new lawyer then went into a public interest career rather than a high-paying BigLaw degree? What about the public defender who, together with her government lawyer spouse, say 20+ years out of law school, has an HHI of $200K a year by way of seniority, but they didn't start out that way and had to pay two sets of law school loans along the way? What about the person who put herself through undergraduate with a degree in math and went into teaching rather than say Wall Street finance?

There's so much judgment in the question. Who are you to say how much someone should have saved, or should have made in their career?

[Anonymous]

And they only count certain assets. My father in law was always pissed his neighbor who was a contractor had a corvette, speedboat and two classic cars and lived in paid off home but reported no income and got free rides to college

The house and boat and multiple cars did not count.

[Anonymous]

Pretty sure the boats/cars would count but your neighbor probably did not report them...

[Anonymous]

"My sister sent her kids to private schools and 8 weeks of sleep over camp. They live in a home that costs 2x what ours does. We have similar income. They are qualified for considerably more aid then we are. They also got aid for the private schools and (religious) camps."

For years, my wife said almost the same thing.

When we finally got to college, the biggest savings any of the kids got was a merit aid grant because the school they fell in love with was in the middle of nowhere. Advantage us.

The next biggest savings was because our DC are two years apart and overlap two years but theirs are three years apart and only overlap one year. More advantage us.

The biggest piles of aid "left on the table" were both in my sister-in-laws family because neither of my nephews would even consider going to a "religious" college. (not that any of them were actually that religious)

While none of our kids went to an in-state school, ours were much more worried about the price of the school they chose because that is something all their friends were comparing.

Then the value of their house was counted against them at the schools that wanted CSS profiles.

Yes, their EFC was smaller than ours but theirs was still large enough so they had to pay the full bill when only one DC was in college.

At the end of the day, the amounts paid were so close that my wife and sister agreed it was impossible to figure out who paid more to send two kids to college.