FAFSA says we can pay $90K; should we have applied for FA?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Just curious, at what HHI did they determine that you could pay $99K?

We make just north of $200k and have a $56k EFC as one data point.

Ugh, sounds just like us. So discouraging. What are they thinking? $56K per year?

Actually, I don't have a problem with it. It isn't supposed to come out of cash flow. It is a known expense and we have had almost 20 years to save for it. We can definitely afford it.

Actually, since the EFC is calculated primarily on income, as opposed to savings, one could be forgiven for thinking it *is* supposed to come out of cash flow. You can have a million dollars socked away in a retirement account, and that doesn't get counted at all in calculating EFC. But if you make $200k in Northern VA (on two incomes), you are supposed to pony up one-quarter of annual gross income on college tuition. #notgonnahappen

No worries, VA has great in-state options. But if you've ever wondered why so many TJ grads are going to UVA instead of the Ivy League....this is why.

This cannot be true. Our HHI is $118K, yet our EFC is $69K. We are savers, so we've paid off our mortgage and put aside retirement money. We cannot possibly pay 58% of our income for college costs. We are a family of six people! We can barely make ends meet on $118K, and we live very frugally. The FAFSA asked for the value of our home and other assets, so clearly its calculating our EFC based mostly on our assets, not our income.

You must have something weird going on in your finances. I used an EFC estimator with the following assumptions:

one parent earning $100k
one parent earning $18k
non-retirement savings of $100k
home worth $750k with no mortgage
4 kids, one in college
living in Virginia

and received an EFC of $21,501 for 2015-2016. Nowhere close to $69k.

To get $69k (actually, $71k), I had to change the non-retirement savings amount to $1 million. Increasing the value of the home did not change the EFC at all.

Do you have all your savings in non-retirement accounts? Savings in qualified IRAs, 401ks, etc, are not reported on the FAFSA and do not count towards your EFC.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Just curious, at what HHI did they determine that you could pay $99K?

We make just north of $200k and have a $56k EFC as one data point.

Ugh, sounds just like us. So discouraging. What are they thinking? $56K per year?

Actually, I don't have a problem with it. It isn't supposed to come out of cash flow. It is a known expense and we have had almost 20 years to save for it. We can definitely afford it.

Actually, since the EFC is calculated primarily on income, as opposed to savings, one could be forgiven for thinking it *is* supposed to come out of cash flow. You can have a million dollars socked away in a retirement account, and that doesn't get counted at all in calculating EFC. But if you make $200k in Northern VA (on two incomes), you are supposed to pony up one-quarter of annual gross income on college tuition. #notgonnahappen

No worries, VA has great in-state options. But if you've ever wondered why so many TJ grads are going to UVA instead of the Ivy League....this is why.

This cannot be true. Our HHI is $118K, yet our EFC is $69K. We are savers, so we've paid off our mortgage and put aside retirement money. We cannot possibly pay 58% of our income for college costs. We are a family of six people! We can barely make ends meet on $118K, and we live very frugally. The FAFSA asked for the value of our home and other assets, so clearly its calculating our EFC based mostly on our assets, not our income.

You must have something weird going on in your finances. I used an EFC estimator with the following assumptions:

one parent earning $100k
one parent earning $18k
non-retirement savings of $100k
home worth $750k with no mortgage
4 kids, one in college
living in Virginia

and received an EFC of $21,501 for 2015-2016. Nowhere close to $69k.

To get $69k (actually, $71k), I had to change the non-retirement savings amount to $1 million. Increasing the value of the home did not change the EFC at all.

Do you have all your savings in non-retirement accounts? Savings in qualified IRAs, 401ks, etc, are not reported on the FAFSA and do not count towards your EFC.

Do you have a second home? A business?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Just curious, at what HHI did they determine that you could pay $99K?

We make just north of $200k and have a $56k EFC as one data point.

Ugh, sounds just like us. So discouraging. What are they thinking? $56K per year?

Actually, I don't have a problem with it. It isn't supposed to come out of cash flow. It is a known expense and we have had almost 20 years to save for it. We can definitely afford it.

Actually, since the EFC is calculated primarily on income, as opposed to savings, one could be forgiven for thinking it *is* supposed to come out of cash flow. You can have a million dollars socked away in a retirement account, and that doesn't get counted at all in calculating EFC. But if you make $200k in Northern VA (on two incomes), you are supposed to pony up one-quarter of annual gross income on college tuition. #notgonnahappen

No worries, VA has great in-state options. But if you've ever wondered why so many TJ grads are going to UVA instead of the Ivy League....this is why.

This cannot be true. Our HHI is $118K, yet our EFC is $69K. We are savers, so we've paid off our mortgage and put aside retirement money. We cannot possibly pay 58% of our income for college costs. We are a family of six people! We can barely make ends meet on $118K, and we live very frugally. The FAFSA asked for the value of our home and other assets, so clearly its calculating our EFC based mostly on our assets, not our income.

This doesn't make sense. We have a gross income ~$200k, $600k in house value and $1.4m in retirement accounts and ours was ~$54k. Are your retirement funds in retirement vehicles or in other investments?

Similar situation here, with slightly less in house value and (sadly) quite a bit less in retirement accounts. (Which don't count towards EFC, even if you have $1.4 m!!). Our EFC is $48k. PP, you are doing something wrong, or have something squirrelly in your finances that you aren't telling us.

[Anonymous]

Maybe serious investment income?

[Anonymous]

NP - am I missing something here? DD's stats are only 1480 on a scale of 2400, right? My DS is downstairs right now doing SAT practice tests to get his 2000 up to 2200, which is the target for the schools he wants to applky to. What am I missing here?

[Anonymous]

1480 on 1600. Use math and critical reading

[Anonymous]

My DC had nearly perfect everything and was invited to apply for a merit scholarship where the year-to-year awards range from $500 to $25,000.

Despite the fact that it is billed as a purely "merit" scholarship, DC was required to fill out the FAFSA to be considered. Our household income, like OP's, reflects that we can afford to pay the full tuition.

I called the institution to ask why we needed to submit the FAFSA for a merit-based scholarship. The representative of the organization told me that your merit determines whether you get the scholarship at all, but the FAFSA determines what amount the scholarship will be for. I was told my DC would likely only receive the $500 scholarship.

[Anonymous]

Anonymous wrote:Maybe you made a mistake. Maybe not.

First, most of the very top schools offer little or no merit aid. Are you very sure the privates your DD applied to offer merit aid? And to what share of students? A school like Duke, eg, offers merit aid to just a handful. (The reason merit aid goes to so many B students (as noted above) is that the top schools don't offer any, so these top students aren't getting any.)

Second, merit aid isn't only about yield management-- it is about attracting better students. Second tier colleges are offering merit aid to their better applicants. Are your DD's stats in the top 25th percentile (or better) of the schools' accepted students? If not, she is highly unlikely to be offered merit aid.

Third, many schools do require you to submit the FAFSA for merit aid. I don't think it's only because they want to make sure you don't qualify for federal funds. I think it's also because they are using merit aid to manage yield, and they know that offers of merit aid will be more enticing to some families than to others. My guess is that a student from a family with HHI of $200k might be more likely to get merit aid than one from a family with HHI of $300k, all else equal. And they might be more likely to offer it to students they think might actually go there. So if the student's stats are TOO high, or if the student hasn't demonstrated any real interest, they might not bother offering merit aid because they don't think the kid is going to come anyway.

IF your DD really wants to go to one of the privates, she gas nothing to lose by calling and asking for more aid. But recognize that the above points will influence the likelihood of her getting any.

Recognize, too, that with an EFC that high, most people wil think you can afford to send her to any of these colleges, aid or no, so sympathy for your DD might not be too great.

I agree with your comment that merit is about attracting better students in addition to yield management. Lots of kids apply to slightly lower tier schools knowing that that's their greatest chance at merit aid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Just curious, at what HHI did they determine that you could pay $99K?

We make just north of $200k and have a $56k EFC as one data point.

Ugh, sounds just like us. So discouraging. What are they thinking? $56K per year?

Actually, I don't have a problem with it. It isn't supposed to come out of cash flow. It is a known expense and we have had almost 20 years to save for it. We can definitely afford it.

Actually, since the EFC is calculated primarily on income, as opposed to savings, one could be forgiven for thinking it *is* supposed to come out of cash flow. You can have a million dollars socked away in a retirement account, and that doesn't get counted at all in calculating EFC. But if you make $200k in Northern VA (on two incomes), you are supposed to pony up one-quarter of annual gross income on college tuition. #notgonnahappen

No worries, VA has great in-state options. But if you've ever wondered why so many TJ grads are going to UVA instead of the Ivy League....this is why.

This cannot be true. Our HHI is $118K, yet our EFC is $69K. We are savers, so we've paid off our mortgage and put aside retirement money. We cannot possibly pay 58% of our income for college costs. We are a family of six people! We can barely make ends meet on $118K, and we live very frugally. The FAFSA asked for the value of our home and other assets, so clearly its calculating our EFC based mostly on our assets, not our income.

This doesn't make sense. We have a gross income ~$200k, $600k in house value and $1.4m in retirement accounts and ours was ~$54k. Are your retirement funds in retirement vehicles or in other investments?

Our house is valued at 550K, paid off, and our investments are in both 401(k)'s and investment accounts. And our HHI is about half of yours. But our FAFSA EFC came out to $69K. It must be because we didn't shelter enough of our retirement $$ in 401(k)'s and IRAs. Don't know if there's anything we can do about that.

[Anonymous]

Anonymous wrote:NP - am I missing something here? DD's stats are only 1480 on a scale of 2400, right? My DS is downstairs right now doing SAT practice tests to get his 2000 up to 2200, which is the target for the schools he wants to applky to. What am I missing here?

No, the schools DD applied to don't count the writing portion, so it's 1480 on a scale of 1600.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Just curious, at what HHI did they determine that you could pay $99K?

We make just north of $200k and have a $56k EFC as one data point.

Ugh, sounds just like us. So discouraging. What are they thinking? $56K per year?

Actually, I don't have a problem with it. It isn't supposed to come out of cash flow. It is a known expense and we have had almost 20 years to save for it. We can definitely afford it.

Actually, since the EFC is calculated primarily on income, as opposed to savings, one could be forgiven for thinking it *is* supposed to come out of cash flow. You can have a million dollars socked away in a retirement account, and that doesn't get counted at all in calculating EFC. But if you make $200k in Northern VA (on two incomes), you are supposed to pony up one-quarter of annual gross income on college tuition. #notgonnahappen

No worries, VA has great in-state options. But if you've ever wondered why so many TJ grads are going to UVA instead of the Ivy League....this is why.

This cannot be true. Our HHI is $118K, yet our EFC is $69K. We are savers, so we've paid off our mortgage and put aside retirement money. We cannot possibly pay 58% of our income for college costs. We are a family of six people! We can barely make ends meet on $118K, and we live very frugally. The FAFSA asked for the value of our home and other assets, so clearly its calculating our EFC based mostly on our assets, not our income.

This doesn't make sense. We have a gross income ~$200k, $600k in house value and $1.4m in retirement accounts and ours was ~$54k. Are your retirement funds in retirement vehicles or in other investments?

Our house is valued at 550K, paid off, and our investments are in both 401(k)'s and investment accounts. And our HHI is about half of yours. But our FAFSA EFC came out to $69K. It must be because we didn't shelter enough of our retirement $$ in 401(k)'s and IRAs. Don't know if there's anything we can do about that.

Bingo, if you had intended those accounts to be retirement, you should have put them in 401k and IRAs. Anything outside of house and official retirement is fair game. How much have you saved in your children's 529s?