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19 minutes ago, Sneezyone said:

I’m gonna need you to know your limits. FAFSA includes ‘investment’ properties  as assets in its calculations which, for military families, includes any home you don’t currently live in regardless of your intention to return. Untaxed military benefits for housing and food have, historically, counted against eligibility for Pell and Perkins DEPENDING ON THE SCHOOL. So, if you live in a HCOL area, through no fault of your own, your gross income would disqualify you regardless of your basic pay rate. These issues are real. They are niche but they should not be dismissed. There are PLENTY of schools, even non-selective schools, that use the profile b/c wealthy people have worked so damn hard to game the system. Military families have suffered as a result and need to be aware of the impact of saving w/real estate vs TSP. Saying that is right and just, not censure-worthy. I appreciate that this isn’t a population you’re familiar with. IJS- IYK, YK and we’d be remiss not to give people that info.

I explained upthread that we, though not military, have a similar situation being a pastor’s family living in a parsonage.We are in a high COL area and own a house in a LCOL area that is our retirement investment house. We wrote letters explaining our situation and several schools reconfigured our EFC which they use for their own formula and we got more financial aid from the school. Now, my kids are high stats so the merit aid weighed in more, but I did want you to know that writing to the schools is an option. There’s no doubt that this type of situation is very unfair. It has taken the highly selective colleges off the table for us. But my kids are getting/have gotten solid educations at their schools. 

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12 minutes ago, 8filltheheart said:

I never dismissed anything regarding FAFSA.  My comments were reserved to CSS Profile schools.  The only thing I mentioned about FAFSA is the simple needs test.  In terms of non-primary residences, that also applies to everyone.  Same for housing.  Pastors who live in a church's house, for example, face the same issue.  If you work internationally and your corp pays for your international housing, the same issue applies. 

That parents don't understand how financial aid works....that I agree with you 100%.  That parents are naive about college costs and funding....I agree.  I have met parents who think that FAFSA's EFC represents the amt that they will pay for school.  Trying to explain that the EFC is a fictional number that is rather meaningless except for federal aid and being dismissed....btdt.

So, again, I can appreciate that this issue affects parsons and international aid workers while also recognizing that it is not, in any way shape or form, the same in impact b/c a lot of those affected don’t know appealing is an option. They are first gens. I’ve counseled several, similarly situated, of my DDs friends.

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2 minutes ago, freesia said:

I explained upthread that we, though not military, have a similar situation being a pastor’s family living in a parsonage.We are in a high COL area and own a house in a LCOL area that is our retirement investment house. We wrote letters explaining our situation and several schools reconfigured our EFC which they use for their own formula and we got more financial aid from the school. Now, my kids are high stats so the merit aid weighed in more, but I did want you to know that writing to the schools is an option. There’s no doubt that this type of situation is very unfair. It has taken the highly selective colleges off the table for us. But my kids are getting/have gotten solid educations at their schools. 

Yeah, I’m not worried about my kids’ options. FRFR, I just don’t want to leave the impression out there that these aren’t concerns people should consider upfront. I’ve seen way, way too many smart military kids be waylaid by their parents lack of info/prep.

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My question would be why shouldn’t owning a home without a mortgage count in the financial aid calculations? 
i don’t own anything without a mortgage nor do I have a retirement/pension—I’m full pay as I should be but these threads have me scratching my head. It’s an asset, of course it counts in family contributions. As 8 says, it’s a choice to be full pay, or not. 

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I agree.

I am just impressed that people have properties paid off or employer provided housing or retirement or any combination of those things and then somehow expect private tuitions to be subsidies by others basically. We fully expect to pay for college without having any of the things listed above and we expect sadly never to retire. Ever. Last day of work for DH will be the day he drops dead. I am expecting to do the same assuming I find employment again. 
And yes, it is a choice. The alternative will be a community college plus state school route, which for a set of reasons is not a good option for DS. 

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6 minutes ago, madteaparty said:

My question would be why shouldn’t owning a home without a mortgage count in the financial aid calculations? 
i don’t own anything without a mortgage nor do I have a retirement/pension—I’m full pay as I should be but these threads have me scratching my head. It’s an asset, of course it counts in family contributions. As 8 says, it’s a choice to be full pay, or not. 

These aren’t homes without mortgages and the “employer provided-housing” comes with a side-helping of mold and toxic waste for your kids. 

Lane…..stay in it.

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3 minutes ago, madteaparty said:

My question would be why shouldn’t owning a home without a mortgage count in the financial aid calculations? 
i don’t own anything without a mortgage nor do I have a retirement/pension—I’m full pay as I should be but these threads have me scratching my head. It’s an asset, of course it counts in family contributions. As 8 says, it’s a choice to be full pay, or not. 

For us it was a business investment, albeit a terrible one. To let me homeschool in a high COL area, I had to do something that let me work from home. Fixer-upper rental sounded like a great idea when my kids were little. Now we’re paying the price—if I sell to fund college, I have no business and can no longer afford to homeschool the younger one. If I had purchased any other type of business, we would be fine in terms of financial aid (my husband’s salary is pretty low). I had no idea this happens with rentals and wish I had run into a thread like this.

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1 minute ago, rzberrymom said:

For us it was a business investment, albeit a terrible one. To let me homeschool in a high COL area, I had to do something that let me work from home. Fixer-upper rental sounded like a great idea when my kids were little. Now we’re paying the price—if I sell to fund college, I have no business and can no longer afford to homeschool the younger one. If I had purchased any other type of business, we would be fine in terms of financial aid (my husband’s salary is pretty low). I had no idea this happens with rentals and wish I had run into a thread like this.

Right, but none of these things are birthrights. Owning a business, private tuitions, homeschooling. These are all choices. I’m making mine. I would own several homes without a mortgage if I chose not to pay full freight. 

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1 minute ago, madteaparty said:

Right, but none of these things are birthrights. Owning a business, private tuitions, homeschooling. These are all choices. I’m making mine. I would own several homes without a mortgage if I chose not to pay full freight. 

It’s about INFORMATION not judgment. People need information to make good choices. Playing Pollyanna doesn’t give people the information they need to make the right choices for their families.

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Just now, madteaparty said:

Right, but none of these things are birthrights. Owning a business, private tuitions, homeschooling. These are all choices. I’m making mine. I would own several homes without a mortgage if I chose not to pay full freight. 

Yes, but owning a business counts differently than owning a rental. It’s a weird quirk in the system. I would have been ok if we had bought some other type of business. We did make a terrible choice.

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5 minutes ago, rzberrymom said:

Yes, but owning a business counts differently than owning a rental. It’s a weird quirk in the system. I would have been ok if we had bought some other type of business. We did make a terrible choice.

It’s not necessarily a terrible choice if it’s profitable but there’s a whole Website and FB group devoted to reluctant military landlords for a reason. We just spent thousands repairing a house we couldn’t sell when DH was transferred in 2007. I am sooooooooooopo flipping glad to be done with that house (which wasn’t purchased with investment in mind) but we were also required to reinvest the proceeds in real estate or pay a huge tax penalty. I’d have happily paid down our primary home loan with the proceeds but that wasn’t a real option. We had NO CLUE that this was the pickle we’d find ourselves in but we’re working through it. Our kids will be much better off b/c we OPENLY talk about it and brainstorm out options. This is a big issue.

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1 hour ago, rzberrymom said:

Yes, but owning a business counts differently than owning a rental. It’s a weird quirk in the system. I would have been ok if we had bought some other type of business. We did make a terrible choice.

Just curious about this. 
 

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1 hour ago, madteaparty said:

My question would be why shouldn’t owning a home without a mortgage count in the financial aid calculations? 
i don’t own anything without a mortgage nor do I have a retirement/pension—I’m full pay as I should be but these threads have me scratching my head. It’s an asset, of course it counts in family contributions. As 8 says, it’s a choice to be full pay, or not. 

Well, in our case we DO have a mortgage, but we also have a lot of home equity because our house has gone up in value a lot (as I understand it, a financial aid office views that home equity the same as if we had a lot because our mortgage was paid off). For us all that means is that our property taxes are a lot higher than they were when we bought the house; we certainly can't tap into the home equity enough to finance college; we wouldn't qualify for the loan. So it's not an asset we could use to pay for college unless we were to actually sell our house. It's not any more accessible as money we could use to pay for college than just...taking out a giant loan. 

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1 hour ago, Roadrunner said:

Just curious about this. 
 

@crazyforlatin  My former neighbor is a full time landlord with more than a dozen section 8 rentals in the Antioch area.
https://finaid.org/fafsa/smallbusiness/

Rental Property – Occasionally a family will try to characterize a rental property as a small business in order to have it excluded as an asset on the FAFSA. For example, the family might own a vacation home which they rent when they aren’t using it themselves.

This situation is addressed in a margin note on page AVG-19 of the 2006-2007 Application and Verification Guide:At times a student or parent will claim rental property is a business. Generally, it must be reported as real estate instead. A rental property would have to be part of a formally recognized business to be reported as such, and it usually would provide additional services like regular cleaning, linen, or maid service.This note mirrors the language from “How To Report Rental Income and Expenses” on page 16 of IRS Publication 527, Residential Rental Property (Including Rental of Vacation Homes). This section of Publication 527 discusses whether rental income is reported on Schedule E or on Schedule C or Schedule C-EZ of IRS Form 1040. In order to file Schedule C or Schedule C-EZ, the taxpayer must “provide significant services that are primarily for your tenant’s convenience, such as regular cleaning, changing linen, or maid service”. It continues “Significant services do not include the furnishing of heat and light, cleaning of public areas, trash collection, etc.” Note that the verification guide is not merely saying that the type of schedule filed indicates whether the rental property is a business asset or not, but rather referring to the same underlying criteria. So while Schedule C or Schedule C-EZ can be an indication of a business, college financial aid administrators will examine the schedule looking for signs of “significant services” besides basic utilities. They may also want to see evidence that the family is treating it as a business, such as registration with the local municipality and the state, an employer identification number (EIN), a fictitious name registration, a separate business checking account and so on. It is not just which schedule was filed, but whether the taxpayer was entitled to file that schedule.On the other hand, if the rental income is reported on Schedule E, it is always reported as an investment asset on the FAFSA. Personal use of the rental property (e.g., as a vacation home) or minimal rental use would also tend to indicate that the rental property is not a business asset.If the family owns multiple rental properties and materially participates in the management of the properties, they are more likely to be considered business assets. Page 21 of IRS Publication 334 elaborates on the criteria for filing Schedule C, indicating that Schedule C is reserved for real businesses and not casual rental income:If you are a real estate dealer who receives income from renting real property or an owner of a hotel, motel, etc., who provides services (maid services, etc.) for guests, report the rental income and expenses on Schedule C or C-EZ. If you are not a real estate dealer or the kind of owner described in the preceding sentence, report the rental income and expenses on Schedule E.Real estate dealer. You are a real estate dealer if you are engaged in the business of selling real estate to customers with the purpose of making a profit from those sales. Rent you receive from real estate held for sale to customers is subject to SE tax. However, rent you receive from real estate held for speculation or investment is not subject to SE tax.”

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5 hours ago, kokotg said:

Well, in our case we DO have a mortgage, but we also have a lot of home equity because our house has gone up in value a lot (as I understand it, a financial aid office views that home equity the same as if we had a lot because our mortgage was paid off). For us all that means is that our property taxes are a lot higher than they were when we bought the house; we certainly can't tap into the home equity enough to finance college; we wouldn't qualify for the loan. So it's not an asset we could use to pay for college unless we were to actually sell our house. It's not any more accessible as money we could use to pay for college than just...taking out a giant loan. 

You’re talking about a primary residence you live in. These are not the facts presented here.  But, to play devil’s advocate even in your case, saying I can’t realize the equity in your house so I need financial aid to pay for private tuition  is the same as me saying: I have my own student loans still, and my 401k is underfunded for my age (you can only put in so much a year), so this little savings I have here as my only asset is really my retirement and not something to be cashed out for college and therefore  it shouldn’t count. I would be laughed out of the room if I made that argument, and possibly correctly so. 

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The thing with employee provided housing is that it isn’t accessible money but counts. As salary. So, if the housing market soars, suddenly your salary increases by a great deal of money. But you can’t access that money in any way or downsize to a smaller less expensive place.

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3 hours ago, madteaparty said:

You’re talking about a primary residence you live in. These are not the facts presented here.  But, to play devil’s advocate even in your case, saying I can’t realize the equity in your house so I need financial aid to pay for private tuition  is the same as me saying: I have my own student loans still, and my 401k is underfunded for my age (you can only put in so much a year), so this little savings I have here as my only asset is really my retirement and not something to be cashed out for college and therefore  it shouldn’t count. I would be laughed out of the room if I made that argument, and possibly correctly so. 

ah, okay--I'm having trouble following when we're talking about primary residences vs. not in this thread. But, at any rate, any cash savings is accessible in a way that my home equity is literally not. If a school said, "go get a parent plus loan" then that's pretty easy to do for most people. A home equity loan comes with stricter income/debt ratio, and someone's who's already used their borrowing power to get the actual house and then watched property values rise around them (a very common scenario right now) can't tap into that, even if they wanted to. Like there ARE plenty of protected assets; someone COULD withdraw from retirement funds for college (albeit with tax implications), but colleges don't expect that. They don't expect you to sell your car and lease one instead. We have a cash value life insurance policy that my husband's grandfather bought for him when he was a toddler that's much more liquid than our house, but colleges don't look at that. It's not something I have big feelings about because our kids so far have done fine with financial aid despite the home equity, but I do think it's sort of nonsensical (if they actually looked at whether you have a mortgage payment or not or how high your housing costs are in general compared to income, then that would make more sense to me). Of course, I suppose if they DIDN'T look at home equity, then people with a lot of savings could pay down their mortgages to hide it. 

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What the entire conversation boils down to is that if you have assets (be it investments, own a house, $$ in the bank, rental properities, etc) meets need schools are going to see those assets as available for paying college.  Each school's formula is proprietary, so how they treat them is slightly different from one to the other (some don't count primary residence equity, for example).  Regardless, they are businesses that are not in business to give $$ away to people with assets.  If they are too expensive for the avg middle class American, then they are too expensive for the avg middle class American.  It has pretty much always been that way and they still have more applicants than they can accept, so there is zero incentive for them to alter their business model bc people are willing to go into debt to attend those schools.  (And income is still one of the largest factors in determining "need." There are caps on asset assessments.)

It all boils down to choice.  No student has a "right" to attend a private school.  No student has a right of expect an institution to pay for their expenses if their parents have assets.  You can get mad, be frustrated that it isn't fair, but the reality is that it is not going to change.  

There are thousands of schools in this country.  There are around 250 schools and scholarship organizations (and those schools include med schools/grad programs) that require the Profile.  The majority of schools don't.  That is bc the majority of schools don't meet need.  If you have assets, your costs at meet need schools can be significantly higher than any public option, including OOS options.  Schools that don't use the Profile rarely award $$ based on financial situation outside of loans, Pell, and Perkins.  If you have a lot of assets (like home equity and you don't want to touch your home), then it really comes down to applying to schools that don't look at it.  The number that do is small.  They may be the ones you want, but it is a choice to apply to those.

I get that it is maddening.  I have btdt.  I equally know that getting frustrated only impacts yourself bc they really don't care.  They are businesses first and foremost.  They have created a formula that they believe creates the most equitable scenario and that is what they are going to use.  I agree that it makes a long list of schools unaffordable bc they don't think you should get to own a home or contribute to retirement.  Their perspective is that they want to assist those who don't have those as options.  And they fund those students at the expense of people who are willing to pay.  If it drives you crazy, get off the merry-go-round and look at different schools.  The reality is that for an UG, the debt is going to be the parents.  Federal loans cap out really quickly, so no student is going to go away to a sleep away 4 yr U on federal loans.  So, creating a realistic plan that actually works is a better use of energy than venting about something that is not going to change.

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I cannot comment too much on the private school financial aid assessment.  But we do own our home outright and that did not ding us on the FAFSA.  A whole lot of other things did and we qualified for almost no aid, but that was no surprise.  Luckily dc got top merit aid and other scholarships so that was moot anyway.

But, to the OP, on bank accounts for aiding elders, this is tricky.  If your name is on it as a joint account owner, then you have to declare it.  But there is such a thing as a "POA account" in which you can be the named custodian without it being considered an asset.  We did this as I too am managing finances for an elder in my life.  I am still on a joint account so that they have access to every-day cash, but I keep less than $1000 in it at any given time so it does not significantly contribute to our assets.  The POA account is where I keep the bulk of the cash and that is not counted.  I am not a joint owner of that money.  It also protects that money from anything that could happen to me, like a lawsuit or divorce proceedings.

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17 hours ago, 8filltheheart said:

I strongly disagree that you need to be prepared to pay the whole enchilada.  I have 2 kids who attended college for free with tuition, room, and board plus additional expenses paid for.  There are schools that offer full-tuition or partial tuition just based on test scores and GPA.  

 

16 hours ago, Sneezyone said:

Are you a military family with significant savings/assets that are *NOT* considered primary b/c you live in OCONUS or government or BAH-paid housing, and have 'average' kids w/o high test scores? If not, what I said DOES NOT APPLY TO YOU.

 

14 hours ago, Sneezyone said:

I'm irritated b/c you want to substitute conjecture for knowledge. RENTERS may or may not have significant assets but usually don't. Military families, particularly as they get toward retirement and their kids graduate often have real assets that aren't their primary home, a situation *MANY* military families find themselves in as they save for/prepare for retirement b/c they don't have primary homes. If you want your kids to have options beyond Truman State (70%+ admissions) which most of us do, TYVM, 1-2K/mo for 9 months of the year isn't an option. You have to prepare. If you get lucky and are stateside at retirement in a state where your kids actually want to attend, great. Moderate income military families may have homes (read, "investment properties" purchased with VA loans and minimal down payments that are not easily converted). Unless your kids have...wait for it...STATS!...this is meaningless info.

 

13 hours ago, Sneezyone said:

I’m gonna need you to know your limits. FAFSA includes ‘investment’ properties  as assets in its calculations which, for military families, includes any home you don’t currently live in regardless of your intention to return. Untaxed military benefits for housing and food have, historically, counted against eligibility for Pell and Perkins DEPENDING ON THE SCHOOL. So, if you live in a HCOL area, through no fault of your own, your gross income would disqualify you regardless of your basic pay rate. These issues are real. They are niche but they should not be dismissed. There are PLENTY of schools, even non-selective schools, that use the profile b/c wealthy people have worked so damn hard to game the system. Military families have suffered as a result and need to be aware of the impact of saving w/real estate vs TSP. Saying that is right and just, not censure-worthy. I appreciate that this isn’t a population you’re familiar with. IJS- IYK, YK and we’d be remiss not to give people that info.

[Navy veteran. Military spouse. When our oldest kids went to college, we were an active duty family, living in PPV housing in a high cost area paying full BAH, we owned a rental property from out newlywed days. We had and still have a full pay EFC. So I understand what you are talking about.]

Yes, it's important for military families (like all families) to understand how the financial aid formulas will consider assets, including non-residence property. Yes, it's going to be considered a family financial asset that is available to help fund college, either through adding to income or being an asset to tap into for loans.

At the same time, there are colleges that offer in state tuition for active duty military families. It takes work to identify them, because it's based on school or state policies. Michigan Tech comes to mind as an example.

There are colleges that offer automatic non-need based aid with dollar amounts based on grades and test scores. While these give the highest awards to the highest stat kids, there are often discounts for strong but not perfect scores too. [I'm not sure what you consider high scores, since the scores typical at 100% meets needs schools are quite different from the range of scores at colleges that offer automatic merit aid. But then you also dismissed Truman State, so I'm guessing you're also not talking about scores below benchmarks.]

A few examples that I know off hand

Miami University

University of Alabama

University of Alabama Huntsville

University of Kentucky

University of Kansas

University of Missouri

Missouri S&T

 

Small liberal arts colleges like those in Colleges That Change Lives often give tuition discounts for most students to encourage enrollment. Whitman, College of Wooster, and Wheaton College (MA) will all do financial pre-reads so families know the prospective final cost before applying.

4 colleges in North Carolina charge only $2,500 per semester for out of state students under the NC Promise program. A new member of the NC Promise program, Fayetteville State University, announced free tuition for military connected students.

 

Military families need to not make assumptions about how demonstrated financial need is determined or how financial aid is allocated at different types of colleges. As you point out, some common investments by military families will be viewed as available to help fund college. There are also a lot of misunderstandings about transferred Post 9/11 GI Bill benefits and Yellow Ribbon benefits (including additional eligibility requirements for in state tuition when using GI Bill, that Yellow Ribbon is not a stand alone scholarship or benefit for military dependents, and that colleges may go back to charging out of state rates when students stop using GI Bill). And there are other misunderstandings about other veterans benefits like Ch 35 educational benefits, CalVet, and Hazelwood Act benefits. Research using official sources is so important.

But it's not really true that a military family with rental property and a high EFC will have to pay full sticker price at every college. Or even at every college worth attending.

 

 

 

 

 

 

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1 hour ago, kokotg said:

ah, okay--I'm having trouble following when we're talking about primary residences vs. not in this thread. 

I *think* the OP was also talking about a rental, not a primary residence. It was a little hard to tell but she mentioned receiving rent for the place, which is how the topic came up. Hopefully she got some info to start with!

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1 hour ago, 8filltheheart said:

What the entire conversation boils down to is that if you have assets (be it investments, own a house, $$ in the bank, rental properities, etc) meets need schools are going to see those assets as available for paying college.  Each school's formula is proprietary, so how they treat them is slightly different from one to the other (some don't count primary residence equity, for example).  Regardless, they are businesses that are not in business to give $$ away to people with assets.  If they are too expensive for the avg middle class American, then they are too expensive for the avg middle class American.  It has pretty much always been that way and they still have more applicants than they can accept, so there is zero incentive for them to alter their business model bc people are willing to go into debt to attend those schools.  (And income is still one of the largest factors in determining "need." There are caps on asset assessments.)

It all boils down to choice.  No student has a "right" to attend a private school.  No student has a right of expect an institution to pay for their expenses if their parents have assets.  You can get mad, be frustrated that it isn't fair, but the reality is that it is not going to change.  

There are thousands of schools in this country.  There are around 250 schools and scholarship organizations (and those schools include med schools/grad programs) that require the Profile.  The majority of schools don't.  That is bc the majority of schools don't meet need.  If you have assets, your costs at meet need schools can be significantly higher than any public option, including OOS options.  Schools that don't use the Profile rarely award $$ based on financial situation outside of loans, Pell, and Perkins.  If you have a lot of assets (like home equity and you don't want to touch your home), then it really comes down to applying to schools that don't look at it.  The number that do is small.  They may be the ones you want, but it is a choice to apply to those.

I get that it is maddening.  I have btdt.  I equally know that getting frustrated only impacts yourself bc they really don't care.  They are businesses first and foremost.  They have created a formula that they believe creates the most equitable scenario and that is what they are going to use.  I agree that it makes a long list of schools unaffordable bc they don't think you should get to own a home or contribute to retirement.  Their perspective is that they want to assist those who don't have those as options.  And they fund those students at the expense of people who are willing to pay.  If it drives you crazy, get off the merry-go-round and look at different schools.  The reality is that for an UG, the debt is going to be the parents.  Federal loans cap out really quickly, so no student is going to go away to a sleep away 4 yr U on federal loans.  So, creating a realistic plan that actually works is a better use of energy than venting about something that is not going to change.

College financial aid is based on several assumptions.

Families are responsible to pay for their children's college costs using family assets before institution assets are tapped.

Financial "resources" include past (savings), present (income), and future (loans) income.

Student owned assets are available at a higher rate than parent assets.

 

There may be other assumptions.

Outside scholarships reduce institutional aid, not the family share.

Ability to pay can be a factor in admissions.

Families are responsible not only for the EFC amount, but any difference between the EFC and the cost after institutional discounts. In other words, there may be a gap between Cost of Attendance and EFC that the family is responsible for.

 

Colleges that are highly sought after prizes, that turn down the vast majority of applicants, often choose to prioritize their financial aid budget for students with little to no family resources. I spent some time this cycle helping a family with an annual income of $28,000. Their EFC was around $1200. Colleges still gapped them about $10k/year, which just wasn't feasible at all. Costs definitely played a part in deciding where that student would attend.

If you are the parent of a middle schooler or young high school student, don't ignore this topic. Start engaging and investigating now, so you aren't trying to juggle it down the road, when your kid is trying to create a college list and do applications.

The book The Price You Pay for College by Ron Lieber would be my first stop. He has some good long webinar interviews online too.

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25 minutes ago, Sebastian (a lady) said:

College financial aid is based on several assumptions.

Families are responsible to pay for their children's college costs using family assets before institution assets are tapped.

Financial "resources" include past (savings), present (income), and future (loans) income.

Student owned assets are available at a higher rate than parent assets.

 

There may be other assumptions.

Outside scholarships reduce institutional aid, not the family share.

Ability to pay can be a factor in admissions.

Families are responsible not only for the EFC amount, but any difference between the EFC and the cost after institutional discounts. In other words, there may be a gap between Cost of Attendance and EFC that the family is responsible for.

 

Colleges that are highly sought after prizes, that turn down the vast majority of applicants, often choose to prioritize their financial aid budget for students with little to no family resources. I spent some time this cycle helping a family with an annual income of $28,000. Their EFC was around $1200. Colleges still gapped them about $10k/year, which just wasn't feasible at all. Costs definitely played a part in deciding where that student would attend.

If you are the parent of a middle schooler or young high school student, don't ignore this topic. Start engaging and investigating now, so you aren't trying to juggle it down the road, when your kid is trying to create a college list and do applications.

The book The Price You Pay for College by Ron Lieber would be my first stop. He has some good long webinar interviews online too.

Good summation.  Merit scholarships at some schools also just swap out institutional aid.  So if your student would have been offered $36000 in aid and wins and $30,000 scholarship from the school, aid is reduced to $6000 (or sometimes they get rid of student contribution but it is definitely not a net gain of $30000 or even close to it.)  Us that offer merit and merit that can stack can be bargains for kids who can equally be accepted to meets need schools. 

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Prepare your children’s hearts, too, so that they have realistic expectations. We did apply to some colleges we thought would be financially unreachable and they mostly were, but we were surprised by a couple. My kids always knew local was the back up. It’s nice to know they got in, too. And honestly, it’s been fine (and I say this as a seven sister schools grad with lots of Ivy League degree relatives.)I will say also that stepping off of the crazy resume building race has been great, too. We put time (but not tons of cash) into test prep and passions to help with scholarship eligibility. 

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16 minutes ago, freesia said:

Prepare your children’s hearts, too, so that they have realistic expectations. We did apply to some colleges we thought would be financially unreachable and they mostly were, but we were surprised by a couple. My kids always knew local was the back up. It’s nice to know they got in, too. And honestly, it’s been fine (and I say this as a seven sister schools grad with lots of Ivy League degree relatives.)I will say also that stepping off of the crazy resume building race has been great, too. We put time (but not tons of cash) into test prep and passions to help with scholarship eligibility. 

Definitely important to prepare your children. So many people will subscribe to the “well you never know” and “there are so many scholarships!” and they are happy to spout these things. It is important not only to have an understanding of limitations but to make sure your kids understand. Yes there are lots of scholarships but that doesn’t mean that anything is possible! 

After homeschoooling my oldest three all the way through my youngest is starting high school at a private school. She scored very well on the entrance exam and I am already preparing for the first meeting with the guidance counselor. Yes to an individualized path to challenge my dd and support her interests. No to the collection of AP courses for collecting sake and crazy resume building and do not even start with the pressure about competitive college applications… we already know (in general) what the options will be for our family and what we value in the process. I am glad I know the deal before getting involved so I will know not to get swept up. 

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21 hours ago, regentrude said:

Just want to comment on this aspect for those who aren't aware of this:
in the sciences, grad school for the terminal degree is normally fully funded. Graduate students receive a stipend for living expenses and a tuition waiver and in exchange are working part time as TAs or RAs in their department. 

This is very true and can be true for some other grad degree programs. Full funding and stipends don't always mean the same thing everywhere.  I know more than one fully funded grad student that did get either some loans or parental help to help cover living expenses, travel, etc.  Especially in higher COL areas.  Just better to have a little flex there if possible.  My kid is just starting to peek at some grad programs now and he is also looking at programs that will probably mostly be funded.  

5 hours ago, 8filltheheart said:

<snip>

They have created a formula that they believe creates the most equitable scenario and that is what they are going to use.  

<snip>

This is all true.  But I disagree with this.  Schools set their formulas to most help their bottom lines, not their students and especially not their families.  Many of these schools have about 20% of their student bodies coming from 1% family (earning over 630K a year).  And about 70% of their student bodies are from the top 20%.  They do this by valuing things in admissions wealthier students bring to the table.  They advertise students don't take loans and are "need blind" but PLENTY of families are taking private loans and cosigning which is not tracked by these institutions.  That's not to say they don't have some students that win their FA lottery and there are a few private schools doing slightly better than this.  But I think it's good to have a sense of this going into it.  New York Times has data online on all schools on this, so you can even get a sense about individual schools.  

I don't know anyone who has had more than maybe 5-10% of an adjustment on going back to FA with additional information.  So we won't spend time on schools that don't come in range of what we can pay target.  

 

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5 minutes ago, catz said:

This is very true and can be true for some other grad degree programs. Full funding and stipends don't always mean the same thing everywhere.  I know more than one fully funded grad student that did get either some loans or parental help to help cover living expenses, travel, etc.  Especially in higher COL areas.  Just better to have a little flex there if possible.  My kid is just starting to peek at some grad programs now and he is also looking at programs that will probably mostly be funded.  

My husband did the required TA hours that are part of his scholarship requirements but nothing more. He did his PhD full time when I was earning a high enough pay to pay mortgage and all living expenses. A friend’s son was given a $10k stipend annually. He lives with his parents so that was sufficient. For PhD students staying on campus, the ones we know signed up to be RAs to get free lodging or subsidized dorm rates.

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One resource I want to point people to is the spreadsheet on Undergraduate Need Based and Merit aid that Jeff Levy and Jennie Kent put out each year.

Basically they comb through the available data from around 40 colleges to find the % of demonstrated need met averaged across all students (this is an average of all students with demonstrated need, not the % of need they meet for each student) and the % who received merit aid (or non-need based aid) and the average award.

99% of students at Agnes Scott get merit aid, so it's reasonable to think that your student might too.

But only 8% of students at Boston University got merit aid, so if your EFC is high, don't expect that grades and scores will lower the price.

You can also see that some colleges award no merit aid.

I'm going to a conference that Jeff and Jennie are speaking at in a couple weeks, if anyone has questions they'd like me to try to ask.

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11 minutes ago, catz said:

This is very true and can be true for some other grad degree programs. Full funding and stipends don't always mean the same thing everywhere.  I know more than one fully funded grad student that did get either some loans or parental help to help cover living expenses, travel, etc.  Especially in higher COL areas.  Just better to have a little flex there if possible.  My kid is just starting to peek at some grad programs now and he is also looking at programs that will probably mostly be funded.  

This is all true.  But I disagree with this.  Schools set their formulas to most help their bottom lines, not their students and especially not their families.  Many of these schools have about 20% of their student bodies coming from 1% family (earning over 630K a year).  And about 70% of their student bodies are from the top 20%.  They do this by valuing things in admissions wealthier students bring to the table.  They advertise students don't take loans and are "need blind" but PLENTY of families are taking private loans and cosigning which is not tracked by these institutions.  That's not to say they don't have some students that win their FA lottery and there are a few private schools doing slightly better than this.  But I think it's good to have a sense of this going into it.  New York Times has data online on all schools on this, so you can even get a sense about individual schools.  

I don't know anyone who has had more than maybe 5-10% of an adjustment on going back to FA with additional information.  So we won't spend time on schools that don't come in range of what we can pay target.  

 

I'm not sure what you are disagreeing with bc I agree with your post.  My pt was that they are very formulaic in how much institutional aid they give and it is not a secret.  (It is the entire purpose behind NPCs.) They don't care that the MC is not well represented bc that isn't their mission.  Their formula works for their financial needs and they pat themselves on the back for helping lower class families by accepting them with huge grants.

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7 hours ago, Sebastian (a lady) said:

 

 

 

 

[Navy veteran. Military spouse. When our oldest kids went to college, we were an active duty family, living in PPV housing in a high cost area paying full BAH, we owned a rental property from out newlywed days. We had and still have a full pay EFC. So I understand what you are talking about.]

Yes, it's important for military families (like all families) to understand how the financial aid formulas will consider assets, including non-residence property. Yes, it's going to be considered a family financial asset that is available to help fund college, either through adding to income or being an asset to tap into for loans.

At the same time, there are colleges that offer in state tuition for active duty military families. It takes work to identify them, because it's based on school or state policies. Michigan Tech comes to mind as an example.

There are colleges that offer automatic non-need based aid with dollar amounts based on grades and test scores. While these give the highest awards to the highest stat kids, there are often discounts for strong but not perfect scores too. [I'm not sure what you consider high scores, since the scores typical at 100% meets needs schools are quite different from the range of scores at colleges that offer automatic merit aid. But then you also dismissed Truman State, so I'm guessing you're also not talking about scores below benchmarks.]

A few examples that I know off hand

Miami University

University of Alabama

University of Alabama Huntsville

University of Kentucky

University of Kansas

University of Missouri

Missouri S&T

 

Small liberal arts colleges like those in Colleges That Change Lives often give tuition discounts for most students to encourage enrollment. Whitman, College of Wooster, and Wheaton College (MA) will all do financial pre-reads so families know the prospective final cost before applying.

4 colleges in North Carolina charge only $2,500 per semester for out of state students under the NC Promise program. A new member of the NC Promise program, Fayetteville State University, announced free tuition for military connected students.

 

Military families need to not make assumptions about how demonstrated financial need is determined or how financial aid is allocated at different types of colleges. As you point out, some common investments by military families will be viewed as available to help fund college. There are also a lot of misunderstandings about transferred Post 9/11 GI Bill benefits and Yellow Ribbon benefits (including additional eligibility requirements for in state tuition when using GI Bill, that Yellow Ribbon is not a stand alone scholarship or benefit for military dependents, and that colleges may go back to charging out of state rates when students stop using GI Bill). And there are other misunderstandings about other veterans benefits like Ch 35 educational benefits, CalVet, and Hazelwood Act benefits. Research using official sources is so important.

But it's not really true that a military family with rental property and a high EFC will have to pay full sticker price at every college. Or even at every college worth attending.

 

 

 

 

 

 

I know that they don’t HAVE to pay, what I said was that they should be prepared to pay and be familiar with the ways military pay and compensation and savings strategies impact aid eligibility (b/c no one knows whether their tots will have any of those options available to them at the time they graduate high school).

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19 hours ago, Sneezyone said:

I know that they don’t HAVE to pay, what I said was that they should be prepared to pay and be familiar with the ways military pay and compensation and savings strategies impact aid eligibility (b/c no one knows whether their tots will have any of those options available to them at the time they graduate high school).

I do agree that too often people make assumptions based on poorly understood rules of thumb they don't stop to crunch numbers on. 

Buying or renting or using base housing is a complex topic that depends on the local housing market, rank, schools, commute, deployment schedule, and military speciality. The advice you hear is often grounded in the other person's experience and you may not know or share that specific context. 

I fight against this often when advising on college admissions topics. Families should be reading VA websites, long explainer articles (Kate Horrell is a favorite), and books. Instead they rely on FB comments stripped of context and misremembered headlines for articles they didn't read.

Members of sites like tend to be ahead of the game in terms of spotting future pain points and putting in the work to try to make a few alternative courses of action. 

 

For those reading along, go do an EFC calculator. Put in round best guess numbers. Do a few net price calculators for 3-4 colleges. Then look at the admissions rates for those schools. Don't just assume you'll make it work to pay for the highest rank college your kid is admitted to.

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