SecondCor521
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Karen,
Thanks!
2Cor521
Thanks!
2Cor521
Help with Financial Aid Decision
- Thread starter TromboneAl
- Start date
LOL!
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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- Jun 25, 2005
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- 10,252
What a great thread! It looks like my plan to pay for college for my kids will work: Retire!
Did I write "work"? I meant "I won't work".
Besides me and T-Al, who else is gonna use retirement to get a great financial aid package?
Did I write "work"? I meant "I won't work".
Besides me and T-Al, who else is gonna use retirement to get a great financial aid package?
I've been reading this thread with great interest. While we are saving and have good hopes to cover much of the college costs, it is somewhat like trying to predict future health care costs - since the total annual financial burden is influenced by where you go, scholarships, available past savings, loans, and current out of pocket costs.
If my plans go as hoped, I will FIRE during my twins' junior year of HS. From this group I have learned that aid is based on past year's income, with the junior year used as the basis for the freshman year. As a result, if I don't make my FIRE goals and have to keeping w*rking, I will end up having to contribute more -- so will need to keeping w*rking!
So, like LOL!, in some ways I hope to FIRE to help pay for college.
If my plans go as hoped, I will FIRE during my twins' junior year of HS. From this group I have learned that aid is based on past year's income, with the junior year used as the basis for the freshman year. As a result, if I don't make my FIRE goals and have to keeping w*rking, I will end up having to contribute more -- so will need to keeping w*rking!
So, like LOL!, in some ways I hope to FIRE to help pay for college.
LOL, I can't tell if you are kidding or not. It is perfectly feasible to semi-retire, a la "Work Less - Live More," and reduce your income to the point that the government and universities step up and pay for your kids' college educations. If you were still working 100%, you would have had to pay for the educations. Work Less - Live More - Get Financial Aid.
A flaw feature of the system is need is measured by what you make, not what you could make if you were really trying.
A flaw feature of the system is need is measured by what you make, not what you could make if you were really trying.
OP
OP
TromboneAl
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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- 12,880
For the first year we got a 2K scholarship from the university, and 4K in one-year scholarships from outside sources, and we paid the rest. After learning from this forum that one can get just as good of an education from a good state school, I did some significant kicking of myself for what I considered was a major financial blunder.
However, with the current level of financial aid, it's turned out OK.
However, with the current level of financial aid, it's turned out OK.
EarlyRetiree
Confused about dryer sheets
- Joined
- May 20, 2007
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- 1
TromboneAl,
Congratulations on winning the financial aid appeal!
This is my first post on this board, and I just wanted to point out something that may help you (and others) in the future in regards to financial aid. IF you can manage to qualify to file a 1040A or 1040EZ federal tax form (instead of the 1040 long form), with your low adjusted gross income it appears that you should qualify for an automatic zero EFC in future years! This is known as "Automatic Zero-EFC."
The key is which tax form you file. If the parents have AGI of $20,000 or less (2006 amount) and the parents can file a 1040A or 1040EZ, then the student's EFC will be zero. This is even if the child has substantial income, or you and your child have substantial assets, as assets would not be counted in the financial aid formula.
There is also another rule known as the "Simplified Needs Test." If the parents have AGI below $50,000 (2006 amount) and the parents can file the 1040EZ or 1040A form, then all the family's assets will be excluded from the federal financial aid formula. This can be a substantial benefit if much of your wealth is outside tax-sheltered retirement plans.
These two rules can make the student eligible for a Pell Grant and other benefits. It's my understanding that if you did file a 1040, but were eligible to file a 1040A or 1040EZ, these rules will still apply. If the only reason you have to file a 1040 is because you have taxable capital gains from the sale of securities, for example, you may want to think about delaying sale of stocks in future years while your child is in college so you can file a 1040A or EZ.
There is an excellent financial aid calculator at http://www.finaid.org/calculators/finaidestimate.phtml that includes these two rules in the calculations. It may be fun to play with the numbers there!
Best wishes!
Congratulations on winning the financial aid appeal!
This is my first post on this board, and I just wanted to point out something that may help you (and others) in the future in regards to financial aid. IF you can manage to qualify to file a 1040A or 1040EZ federal tax form (instead of the 1040 long form), with your low adjusted gross income it appears that you should qualify for an automatic zero EFC in future years! This is known as "Automatic Zero-EFC."
The key is which tax form you file. If the parents have AGI of $20,000 or less (2006 amount) and the parents can file a 1040A or 1040EZ, then the student's EFC will be zero. This is even if the child has substantial income, or you and your child have substantial assets, as assets would not be counted in the financial aid formula.
There is also another rule known as the "Simplified Needs Test." If the parents have AGI below $50,000 (2006 amount) and the parents can file the 1040EZ or 1040A form, then all the family's assets will be excluded from the federal financial aid formula. This can be a substantial benefit if much of your wealth is outside tax-sheltered retirement plans.
These two rules can make the student eligible for a Pell Grant and other benefits. It's my understanding that if you did file a 1040, but were eligible to file a 1040A or 1040EZ, these rules will still apply. If the only reason you have to file a 1040 is because you have taxable capital gains from the sale of securities, for example, you may want to think about delaying sale of stocks in future years while your child is in college so you can file a 1040A or EZ.
There is an excellent financial aid calculator at http://www.finaid.org/calculators/finaidestimate.phtml that includes these two rules in the calculations. It may be fun to play with the numbers there!
Best wishes!
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