Reply to What money is fair game for financial aid?

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[quote=Anonymous][quote=Anonymous]I don't understand the reasoning behind using home value. Is the idea that the parents should remortgage the house to pay for school? For many people living in high COL places, house equity is part of their retirement nest egg. I'd love to have enough money to both pay a ridiculously high mortgage payment AND max out my retirement savings, but I can't. I plan to retire to my hometown where I can easily buy a low cost house there with the equity I'll walk away with after I sell my DC house. If I have to remortgage it, then I won't be able to buy a house when I retire. From what I understand, if that money were tied up in a retirement account, it would be untouchable and schools wouldn't consider it as available for college expenses. Is that right?

And what about savings accounts? Aren't we supposed to have three months of living expenses sitting in a savings account? That's a lot of money for people with high mortgages like many of us in DC or for those of us with medical issues. Is the fact that we squirreled those funds away in case of job loss (single mom here) going to be used against us for need-based financial aid?[/quote]

CSS schools can consider home equity and retirement accounts, the logic being that if you paid into both aggressively while not saving for school, that is a choice you made and you shouldn't be rewarded. Some CSS schools will disregard or or the other or both. FAFSA considers neither. Saving accounts, brokerages, and any other money you have will be used against you. [/quote]

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