by Chris Everett
If you have middle school students heading to college someday, I recommend learning about how the “system” works now. For example, discover what your EFC or expected family contribution is now. It’s calculated on the number attending college in any year, your household size and ages, current “exposed” assets, household parent and student income, and student assets.
Even though the formulas are tweaked every year in the governments favor (because the national debt is so high), knowing your family’s EFC now can provide perspective. It can also help you to being to shift assets where they will not be counted in the formulas.
Here’s a list of assets that are counted:
- Cash (including your mattress money)
- Checking and Savings
- Stocks and Bonds
- CDs and Money Markets
- Mutual Funds
- 529 Investment Accounts (for all students not just the college bound ones)
- Rental Property
- Vacation Home
- Stock Options
- Trust Accounts
- Student Owned Assets
- Small Business Equity (not family owned)
As you can see, that’s quite a list. Here’s the list of assets not counted in the financial aid formulas:
- Retirement Accounts
- Home Equity
- Life Insurance Cash Values
- Family Farm
- Small Business Assets (family owned with fewer than 101 employees)
Yet, there are caveats to many of these assets – countable and not countable. Speak with a College Planner to get the right scoop for your family. You know what they say, for the best result, first consult.
At EWS we offer a free consultation. That way you can see where the risk is and what you might do about it. Let us know if you are interested. I’ve made a vow that we will only take on clients we can help.