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

[Anonymous]

Anonymous wrote:We currently have $200,000 in cash and stocks, and only $160,000 in two 529s for our kids who are starting college this year and next ($80,000 each.) We originally kept the $200,000 as an emergency fund, but now we realize that amount of cash is really hurting our changes for financial aid. (I know this because I've played around with the net price calculator for the expensive SLAC that my younger kid is interested in.)

I'm trying to figure out how to reduce our cash holdings. My options are:

1-Put all the money into retirement accounts and pay college only out of cashflow, but that puts us in a very tight spot with college payments if our income suddenly drops or if college ends up costing more than anticipated.
2-Put all the money into the 529s, and then use the cashflow we were planning to use for college to boost our retirement savings (so it doesn't end up accumulating as cash.)


I guess my question is, is there a downside to simply dumping $200,000 of cash into the 529 plans in a single year, before the first kid starts college? Will it trigger some kind of tax spike or raise a red flag for the colleges?

Um. Use the cash to pay the tuition??!!

WTAF is wrong with you.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

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.

Look don't worry about it, amass the debt. Kamala and Joe will forgive it and we will all pay for it. You're welcome.

Just like we pay for all the fake disability folks that live in WV, LA, MS, etc., and everything else funded by the government.

Interested, did you receive your invoice for all these things yet? Me neither.

I'm more concerned with the corporations that pay no taxes. That's where the real money is, but R's don't want to tax their friends.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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.

Look don't worry about it, amass the debt. Kamala and Joe will forgive it and we will all pay for it. You're welcome.

Just like we pay for all the fake disability folks that live in WV, LA, MS, etc., and everything else funded by the government.

Interested, did you receive your invoice for all these things yet? Me neither.

I'm more concerned with the corporations that pay no taxes. That's where the real money is, but R's don't want to tax their friends.

This idea that companies turning profits don’t pay taxes is pretty much bullshit.

And no, it’s not where the real money is. The real money is in tax expenditures for individuals. For example, the deduction employers get for providing health insurance even though that compensation is tax-free to you too. That’s where the money is

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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.

Look don't worry about it, amass the debt. Kamala and Joe will forgive it and we will all pay for it. You're welcome.

Just like we pay for all the fake disability folks that live in WV, LA, MS, etc., and everything else funded by the government.

Interested, did you receive your invoice for all these things yet? Me neither.

I'm more concerned with the corporations that pay no taxes. That's where the real money is, but R's don't want to tax their friends.

This idea that companies turning profits don’t pay taxes is pretty much bullshit.

And no, it’s not where the real money is. The real money is in tax expenditures for individuals. For example, the deduction employers get for providing health insurance even though that compensation is tax-free to you too. That’s where the money is

Thanks Jeff Bezos for your insights!

[Anonymous]

Anonymous wrote:

Anonymous wrote:people with 300K HHI should have money saved for college, just like you do.

these "oh poor me" posts from people with top % incomes are ridiculous.

We just made it to $300k and just finished paying off our own loans. It’s not easy when the $300k comes towards ends of career and expenses were high before then. Don’t assume.

Why not have your DC attend an in-state college or lower tier private? You problem is focusing on colleges that don't give much or any merit aid. $85k for college is a ripoff, even if you can comfortably afford the cost.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:America likes to punish middle class savers. It’s better to have no savings and get full need based aid.

Stupid statement. Only 5% of assets (savings) are counted towards paying for college.

Ha, ha, ha, ha! Maybe if you are low income. Most private colleges want you to raid your retirement, remortgage your house, take out loans…

+1 That's why they also ask for the market price of your house.

Yes, and whatever the equity of your house--5% is expected to go toward COA.

Is it only 5%? Where does it say that?

That's the fafsa formula. CSS schools calculate however they like. You can reverse engineer somewhat using their own NPC calculators but I've not done it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:America likes to punish middle class savers. It’s better to have no savings and get full need based aid.

Stupid statement. Only 5% of assets (savings) are counted towards paying for college.

Ha, ha, ha, ha! Maybe if you are low income. Most private colleges want you to raid your retirement, remortgage your house, take out loans…

Lying. Retirement funds do not count .

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:America likes to punish middle class savers. It’s better to have no savings and get full need based aid.

Stupid statement. Only 5% of assets (savings) are counted towards paying for college.

Ha, ha, ha, ha! Maybe if you are low income. Most private colleges want you to raid your retirement, remortgage your house, take out loans…

+1 That's why they also ask for the market price of your house.

Yes, and whatever the equity of your house--5% is expected to go toward COA.

Is it only 5%? Where does it say that?

That's the fafsa formula. CSS schools calculate however they like. You can reverse engineer somewhat using their own NPC calculators but I've not done it.

5% is still an accurate rule of thumb. The home equity may also be capped according to income.

Assume this has already been stated but a 529 in the parents name is treated exactly the same as the current account, 5% contributes to COA. It's too late to make a move, and moving to 529 has no upside as far as the formulas go.

[Anonymous]

Anonymous wrote:America likes to punish middle class savers. It’s better to have no savings and get full need based aid.

Well , everyone has the option of saving nothing.

It is not like they could not see this expense coming .

You have to tighten your belt when your kids are in college, not explore ways to hide your assets!

It goes fast.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Why do you have $200K in an emergency fund?

Is that for emergency Porsche replacement?

Have you ever calculated the minimum cash you need for a year - mortgage, utilities, food, insurance, cars, etc? It’s a lot more than you might think. Depending on their mortgage, $200k might be ballpark.

Most people can't afford to keep a year's worth of expenses as an emergency fund.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Why do you have $200K in an emergency fund?

Is that for emergency Porsche replacement?

Have you ever calculated the minimum cash you need for a year - mortgage, utilities, food, insurance, cars, etc? It’s a lot more than you might think. Depending on their mortgage, $200k might be ballpark.

Most people can't afford to keep a year's worth of expenses as an emergency fund.

And it's not even recommended to keep 12 months of cash. 3 months top

[Anonymous]

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

+1. The npc you are looking at may be for merit not financial aid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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.

Look don't worry about it, amass the debt. Kamala and Joe will forgive it and we will all pay for it. You're welcome.

Just like we pay for all the fake disability folks that live in WV, LA, MS, etc., and everything else funded by the government.

Interested, did you receive your invoice for all these things yet? Me neither.

I'm more concerned with the corporations that pay no taxes. That's where the real money is, but R's don't want to tax their friends.

Yes! No Dem registered voters have corps or pass through vehicles shielding income. Look at the Clintons! It's outrage - Rs only look for tax breaks. The Dems pay taxes and more whenever they can.

[Anonymous]

You won't get any FA, OP. Colleges are making their business to level the economic playing ground. People who are comfortable but not rich are not permitted to have any luxuries or benefit from their work but are expected to save it all for college tuition. While others go for nearly free, and at our expense. And then WE are told not to whine. LOL.

[Anonymous]

Anonymous wrote:You won't get any FA, OP. Colleges are making their business to level the economic playing ground. People who are comfortable but not rich are not permitted to have any luxuries or benefit from their work but are expected to save it all for college tuition. While others go for nearly free, and at our expense. And then WE are told not to whine. LOL.

Thank you for not whining. LOL !