College grant ( not loans ) eligibilty

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skor99
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College grant ( not loans ) eligibilty

Post by skor99 » Wed Aug 15, 2018 12:09 pm

I have been told by various people that if somebody has over 1MM net worth ( not including primary residence) or approx over 500K in non retirement assests then one should not expect any grants from college which are not merit based and therefore there is no need for FAFSA and the unnecessary disclosure of your finances. The Net price calculator on college websites seems to corroborate this view.

So of I have sufficient money to cashflow my kids education, should I even bother with FAFSA given that my retirement and non retirement assets are over the numbers shown above ? What has been the experience of people who have gone through this? Would appreciate all guidance in this matter.

NotWhoYouThink
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Re: College grant ( not loans ) eligibilty

Post by NotWhoYouThink » Wed Aug 15, 2018 1:11 pm

Income affects financial aid more than assets. Depending on your income, you might still qualify for financial aid. If your student is accepted at one of the few schools that offer grant aid.

I've heard stories about colleges that won't grant merit aid unless you fill out FAFSA, but don't know which ones those would be. None my kids applied to. If that is the case the college financial aid website will tell you.

If you've used the Net Price Calculators and are confident that you will not qualify for need-based aid, and if the colleges your student applies to do not require FAFSA for merit aid, then there is no benefit to filling it out and submitting it. It isn't particularly difficult or time consuming, but we determined it was unnecessary and skipped it for all but one (really bad income) year.

KlangFool
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Re: College grant ( not loans ) eligibilty

Post by KlangFool » Wed Aug 15, 2018 1:15 pm

skor99 wrote:
Wed Aug 15, 2018 12:09 pm
I have been told by various people that if somebody has over 1MM net worth ( not including primary residence) or approx over 500K in non retirement assests then one should not expect any grants from college which are not merit based and therefore there is no need for FAFSA and the unnecessary disclosure of your finances. The Net price calculator on college websites seems to corroborate this view.

So of I have sufficient money to cashflow my kids education, should I even bother with FAFSA given that my retirement and non retirement assets are over the numbers shown above ? What has been the experience of people who have gone through this? Would appreciate all guidance in this matter.
skor99,

My son and daughter received merit scholarships. I did not have to fill out a FAFSA. But, please note that this is highly specific to each university/scholarship requirement.

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Jack FFR1846
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Re: College grant ( not loans ) eligibilty

Post by Jack FFR1846 » Wed Aug 15, 2018 1:25 pm

Depends on the school.

My son was applying to "better" schools as he wrapped up his freshman year. I can say that we're in that $500k countable assets category and I make too much money. But he was accepted at Boston University and given 2 grants totaling $13k. He ended up going to a more engineering college which gave him zip. So I believe it's worth filling out FAFSA the first year to see. For the colleges applied to, we needed to also fill out CSS, which gets into more than FAFSA does.
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skor99
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Re: College grant ( not loans ) eligibilty

Post by skor99 » Wed Aug 15, 2018 2:27 pm

I am not comfortable giving out personal financial details as it is, especially not when I will not get anything out of it. I don’t think any university will require you to provide that information if you are willing to forgo grants. Correct?

Jack FFR1846
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Re: College grant ( not loans ) eligibilty

Post by Jack FFR1846 » Wed Aug 15, 2018 2:31 pm

skor99 wrote:
Wed Aug 15, 2018 2:27 pm
I am not comfortable giving out personal financial details as it is, especially not when I will not get anything out of it. I don’t think any university will require you to provide that information if you are willing to forgo grants. Correct?
Change "grants" to "aid" and I'd say your statement is correct.

Aid is: loans, grants, work-study, access to Stafford and other loans. If you don't need the Stafford loans, forgo them. They carry an origination fee that comes off the money before it even hits the bursar's office and the interest rates are high.

And indeed, if you are looking for no "aid", then the college won't require a FAFSA.
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HereToLearn
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Re: College grant ( not loans ) eligibilty

Post by HereToLearn » Wed Aug 15, 2018 2:37 pm

skor99 wrote:
Wed Aug 15, 2018 2:27 pm
I am not comfortable giving out personal financial details as it is, especially not when I will not get anything out of it. I don’t think any university will require you to provide that information if you are willing to forgo grants. Correct?
Your child can apply to college without evening providing his SSN, but once he has decided where he will attend college, that school will demand his SSN. He also does not need to provide his SSN when registering for the SAT or ACT.

As stated above, merit awards can be granted w/o providing SSN but some schools will require. Not all though.

skor99
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Re: College grant ( not loans ) eligibilty

Post by skor99 » Wed Aug 15, 2018 3:01 pm

Maybe I am not being clear on what I mean. I know there is always aid in the form of loans available which needs to be repayed. I also understand that financial details need to provided to get any such loans.
What I am talking about is grants that don’t need to be paid like merit or need based grants. Obviously the merit based grants won’t require financial info, but the need based do. My question is if I won’t be eligible for any need based grants per my assets, is it even worth disclosing them ?
Therefore just confirming with folks on this forum if somebody with assets more than 1.5MM would even have a remote chance of need based grants ?

NotWhoYouThink
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Re: College grant ( not loans ) eligibilty

Post by NotWhoYouThink » Wed Aug 15, 2018 3:09 pm

The answer is: It's complicated.

In almost all cases, if you are confident you will not be eligible for need-based grant aid, there is no need to submit the FAFSA.

For a small number of schools (3? 12? I'm not sure. not many) you can't even get merit aid if you don't submit FAFSA. It would be an outlier case, but people aren't going to say never-never-never unless you name the school.

edited to add: depending on the school, and where your assets are held (after-tax accounts vs. housing and retirement accounts) it would be possible to get need based aid with $1.5 million in assets if your INCOME were low enough or you had multiple kids in college. But you haven't mentioned your income or the potential school or anything about your family, so the answer remains - it's complicated, and it depends.

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DaftInvestor
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Re: College grant ( not loans ) eligibilty

Post by DaftInvestor » Wed Aug 15, 2018 3:14 pm

NotWhoYouThink wrote:
Wed Aug 15, 2018 3:09 pm
The answer is: It's complicated.

In almost all cases, if you are confident you will not be eligible for need-based grant aid, there is no need to submit the FAFSA.

For a small number of schools (3? 12? I'm not sure. not many) you can't even get merit aid if you don't submit FAFSA. It would be an outlier case, but people aren't going to say never-never-never unless you name the school.
+1 on this - ask the schools to which you are applying.

The other reason to fill it out is if you want to take the non-subsidized government loans (unlike subsidized loans interest starts accruing immediately).
I filled it out for both my children and for both it was wasted time (didn't fill it out past first year). Once of the colleges did state to us that when they make merit aid decisions they do want to know what need-based aid is available. Other colleges told us this wasn't the case so it seems dependent upon the school. Some schools did tell us "We recommend everyone fill it out" - when I pushed them as to why they said thing "in case you want the loan" / "in case your circumstances change" / etc. Nothing too concrete in my opinion.
skor99 wrote:
Wed Aug 15, 2018 3:01 pm
Obviously the merit based grants won’t require financial info....
This is the statement you made that isn't always the case. I don't know if its because they want to assure you can't get the money based upon need before they give it to you based upon merit; or if they actually take need into account (to some degree) before they award merit; but its what some schools will tell you.

Aside: The best way to get merit aid is to apply for schools whereby your test scores / grades are ABOVE the school average. Schools want to raise their scores so typically won't give merit aid unless your kid is contributing to doing so (and Ivy League / Top schools give $0 in merit aid because they have enough people willing to pay full price).

skor99
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Re: College grant ( not loans ) eligibilty

Post by skor99 » Wed Aug 15, 2018 3:35 pm

NotWhoYouThink wrote:
Wed Aug 15, 2018 3:09 pm
The answer is: It's complicated.

In almost all cases, if you are confident you will not be eligible for need-based grant aid, there is no need to submit the FAFSA.

For a small number of schools (3? 12? I'm not sure. not many) you can't even get merit aid if you don't submit FAFSA. It would be an outlier case, but people aren't going to say never-never-never unless you name the school.

edited to add: depending on the school, and where your assets are held (after-tax accounts vs. housing and retirement accounts) it would be possible to get need based aid with $1.5 million in assets if your INCOME were low enough or you had multiple kids in college. But you haven't mentioned your income or the potential school or anything about your family, so the answer remains - it's complicated, and it depends.
Only 1 kid in college, for the next 5 years, so no overlap. Also AGI has generally been 120K + except for 2016 / 17 when it was 80 amd 90 K . I anticipate it to be higher this year again,

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munemaker
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Re: College grant ( not loans ) eligibilty

Post by munemaker » Wed Aug 15, 2018 3:42 pm

We had two kids who attended college (not at the same time). My reaction from reviewing the formulas was no way would we qualify any grants and I was not planning to fill out the FASFA. Like you, we were not interested in loans or work study programs.

Friends of mine influenced me, saying "You might be surprised." (They had no idea of our net worth)

Well, I was not surprised. Regretted giving up the information with no return and never did it again.

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TomatoTomahto
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Re: College grant ( not loans ) eligibilty

Post by TomatoTomahto » Wed Aug 15, 2018 4:17 pm

skor99 wrote:
Wed Aug 15, 2018 3:35 pm
NotWhoYouThink wrote:
Wed Aug 15, 2018 3:09 pm
The answer is: It's complicated.

In almost all cases, if you are confident you will not be eligible for need-based grant aid, there is no need to submit the FAFSA.

For a small number of schools (3? 12? I'm not sure. not many) you can't even get merit aid if you don't submit FAFSA. It would be an outlier case, but people aren't going to say never-never-never unless you name the school.

edited to add: depending on the school, and where your assets are held (after-tax accounts vs. housing and retirement accounts) it would be possible to get need based aid with $1.5 million in assets if your INCOME were low enough or you had multiple kids in college. But you haven't mentioned your income or the potential school or anything about your family, so the answer remains - it's complicated, and it depends.
Only 1 kid in college, for the next 5 years, so no overlap. Also AGI has generally been 120K + except for 2016 / 17 when it was 80 amd 90 K . I anticipate it to be higher this year again,
A lot depends on the school. HYP would give considerable aid with an AGI of $80-120, but would expect a FAFSA and more details. They are among the most generous schools.
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Travelfan
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Re: College grant ( not loans ) eligibilty

Post by Travelfan » Wed Aug 15, 2018 5:04 pm

We just went through this with our oldest. Just for reference, our family AGI is considerably higher, but our assets are lower. He was given a $15,000 grant at his top pick, where tuition costs over $70,000. He turned it down for the merit scholarship at our state flagship, but that’s another story. My point is, it is probably worth doing FAFSA the first year.

skor99
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Re: College grant ( not loans ) eligibilty

Post by skor99 » Wed Aug 15, 2018 5:54 pm

TomatoTomahto wrote:
Wed Aug 15, 2018 4:17 pm
skor99 wrote:
Wed Aug 15, 2018 3:35 pm
NotWhoYouThink wrote:
Wed Aug 15, 2018 3:09 pm
The answer is: It's complicated.

In almost all cases, if you are confident you will not be eligible for need-based grant aid, there is no need to submit the FAFSA.

For a small number of schools (3? 12? I'm not sure. not many) you can't even get merit aid if you don't submit FAFSA. It would be an outlier case, but people aren't going to say never-never-never unless you name the school.

edited to add: depending on the school, and where your assets are held (after-tax accounts vs. housing and retirement accounts) it would be possible to get need based aid with $1.5 million in assets if your INCOME were low enough or you had multiple kids in college. But you haven't mentioned your income or the potential school or anything about your family, so the answer remains - it's complicated, and it depends.
Only 1 kid in college, for the next 5 years, so no overlap. Also AGI has generally been 120K + except for 2016 / 17 when it was 80 amd 90 K . I anticipate it to be higher this year again,
A lot depends on the school. HYP would give considerable aid with an AGI of $80-120, but would expect a FAFSA and more details. They are among the most generous schools.
But won’t they also look at liquid assets of more than 1.5MM ? Does any school provide need based aid to millionaires ?

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TomatoTomahto
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Re: College grant ( not loans ) eligibilty

Post by TomatoTomahto » Wed Aug 15, 2018 6:13 pm

skor99 wrote:
Wed Aug 15, 2018 5:54 pm
TomatoTomahto wrote:
Wed Aug 15, 2018 4:17 pm
skor99 wrote:
Wed Aug 15, 2018 3:35 pm
NotWhoYouThink wrote:
Wed Aug 15, 2018 3:09 pm
The answer is: It's complicated.

In almost all cases, if you are confident you will not be eligible for need-based grant aid, there is no need to submit the FAFSA.

For a small number of schools (3? 12? I'm not sure. not many) you can't even get merit aid if you don't submit FAFSA. It would be an outlier case, but people aren't going to say never-never-never unless you name the school.

edited to add: depending on the school, and where your assets are held (after-tax accounts vs. housing and retirement accounts) it would be possible to get need based aid with $1.5 million in assets if your INCOME were low enough or you had multiple kids in college. But you haven't mentioned your income or the potential school or anything about your family, so the answer remains - it's complicated, and it depends.
Only 1 kid in college, for the next 5 years, so no overlap. Also AGI has generally been 120K + except for 2016 / 17 when it was 80 amd 90 K . I anticipate it to be higher this year again,
A lot depends on the school. HYP would give considerable aid with an AGI of $80-120, but would expect a FAFSA and more details. They are among the most generous schools.
But won’t they also look at liquid assets of more than 1.5MM ? Does any school provide need based aid to millionaires ?
As others have said, it more depends on income, and also what the nature of assets is. It is possible to get need based aid as a millionaire, if you’re the right kind of millionaire. It is not, however, common. Run the calculators; they’re generally close to accurate. It also depends on when child is entering school; they recently changed the lookback.
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Minty
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Re: College grant ( not loans ) eligibilty

Post by Minty » Wed Aug 15, 2018 6:26 pm

Lots of schools, including mine, provide need-based financial aid to multimillionaires, in theory, based on the way the FAFSA works. FAFSA excludes retirement accounts, primary residences, and family businesses with 100 or fewer full-time employees. So if you own outright, say, a prewar Park Avenue triplex, and 100% of a real estate management company with $100 million in assets and retained earnings, and the business made you loans of $1 million per year to pay for your yacht and polo ponies along with a $10,000 salary, you would report on the FAFSA assets of zero, income of $10,000, and your kids could attend my highly ranked public university for free if they could get in. FAFSA is superficial because the foregoing scenario is rare. However, most of the privates require something in addition to the FAFSA called the CSS Profile, which xrays your actual assets quite realistically. I believe that if parents had $1 million in a taxable account or home equity, they would get no need-based aid in the absence of extraordinary circumstances such as permanent disability.
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Jack FFR1846
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Re: College grant ( not loans ) eligibilty

Post by Jack FFR1846 » Wed Aug 15, 2018 7:40 pm

I don't want to assume, so I'll just spurt out what I'm thinking.....

"assets" also need to be defined. If you have a $3M house and $2M in retirement accounts but only $20k in taxable and retired and take in $15k a year, you're getting a boatload of aid.

But if you have $350k in US savings bonds and make $100k-ish a year, you're likely getting nothing (the boat I'm in).

Talking just about FAFSA only schools.

Either scenario going to Harvard, you'll likely get a ton of grants.
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skor99
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Re: College grant ( not loans ) eligibilty

Post by skor99 » Wed Aug 15, 2018 9:29 pm

I am in the same boat, more than 500K in non retirement assets with 100K + income.. But Why a ton of grants in Harvard ?

getthatmarshmallow
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Re: College grant ( not loans ) eligibilty

Post by getthatmarshmallow » Wed Aug 15, 2018 9:47 pm

Check with the school. Some universities use FAFSA to construct the merit scholarship pool, too, and sometimes it affects how internal funding gets allocated.

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teen persuasion
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Re: College grant ( not loans ) eligibilty

Post by teen persuasion » Wed Aug 15, 2018 10:11 pm

I had a full ride (tuition) merit scholarship. The college required my family to file a FAFSA, because they would reduce the grant by any state or federal need based aid I was eligible for. It was a PITA, because TAP and PELL were estimated at billing time, and always estimated high. My scholarship would then be insufficient to cover my bill at the bursar's office, so every year I had to request that my scholarship amount be adjusted to match the actual TAP and PELL numbers.

This also meant that I couldn't use the TAP and PELL grants for room and board or book expenses. I had no real incentive to pursue need based aid as it didn't increase my aid total, except in the sense that the school would discount my scholarship because I was eligible for need based aid. My incentive was to RETAIN my full merit scholarship.


Google "EFC formulas 2018-19" for the pdf and walk thru the calculations yourself. Start on page 9. Google "paper FAFSA" for the inputs to a few lines. Some are not immediately intuitive - they don't directly ask for FICA withheld (to subtract from "available income"), they ask for income earned and calculate FICA. Well, "earned income" is a fuzzy term if you are contributing to tax deferred accounts like 401k or HSA accounts. HSA contributions thru payroll are not FICA taxed, but t401k contributions are, and neither are included in earned income on your 1040. Another non-intuitive question involves who counts as a family member. After graduating from college, DS2 was included in our family #, despite being independent and living in another city. However, DD3 would have dropped out of our family # if she went on to grad school even if we were supporting her financially. Larger family size is better for aid - leads to a larger "income protection amount".

HereToLearn
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Re: College grant ( not loans ) eligibilty

Post by HereToLearn » Wed Aug 15, 2018 10:28 pm

Jack FFR1846 wrote:
Wed Aug 15, 2018 7:40 pm
I don't want to assume, so I'll just spurt out what I'm thinking.....

"assets" also need to be defined. If you have a $3M house and $2M in retirement accounts but only $20k in taxable and retired and take in $15k a year, you're getting a boatload of aid.

But if you have $350k in US savings bonds and make $100k-ish a year, you're likely getting nothing (the boat I'm in).

Talking just about FAFSA only schools.

Either scenario going to Harvard, you'll likely get a ton of grants.
If by grants you mean merit aid.....Harvard does not award merit aid. They have a very generous financial aid program but all awards are need-based.

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