Three Female Students, wearing different college T shirts, smiling. Student and Staff Member, sitting across a desk from each other, in a College Planning meeting. Four staff members, standing against a brick wall, laugh as one staff juggles. Male student with backpack walking across college campus. Two female students with backpacks walking in building on campus.
Two female students talking in the campus library. You need to be careful when liquidating student assets. The first issue is the tax consequence of liquidating assets. Do your research as this limit changes periodically based on the tax code.
The next issue is ownership of the account or asset. A parent would need to have documentation to properly liquidate a Uniform Gift to Minor Account UGMA account , which is the type of account issued for most children under the age of eighteen. It is expected to start in the school year It is unclear how the colleges will handle this major change. This will mean families with multiple children in college at the same time will qualify for less need-based financial aid.
The most common is the CSS profile which uses a secondary process and is used by many of the more competitive schools. Within this method, each college can modify the calculation to their specific goal. This number is often not explained or displayed to you. In most cases, this number is higher due to the inclusion of other items.
The college will typically use the higher of the two numbers when designing a student financial aid award. Understanding the parts of your EFC is essential for creating the proper paying for college strategies. With this knowledge and the financial award letter, students can better project their college affordability and the financial outcome of getting a college degree.
We often understate the importance of affordability and focus only on admissions. Focusing on the outcome needs to be part of the decision. PayForED does have a more detailed software analysis available for families who want more help. The PayForED College Cost Analyzer will provide a detailed estimated family contribution and estimated financial aid award calculation by the college.
If you do qualify, the system will exclude household assets from the calculation of your EFC number. This generally means your household will be seen to have fewer financial resources, so your EFC will be lower, and your eligible aid package will be higher. Each school considers your EFC to calculate how much federal student aid you are eligible for. The COA will often include room and board that is, accommodation and meals , textbooks, student fees, and transportation.
Usually, colleges will try to close that gap by providing you with a financial aid package consisting of grants, loans, and work-study. Here are three examples of how this calculation will work:. Some schools or organizations also offer financial aid that is not need-based, to provide further financial assistance. In other words, your eligibility is based on the amount remaining, after receiving need-based aid, scholarships, and grants.
Your EFC is not considered here. Many of these scholarships have no household income requirement and are open to all kinds of families, not just low-income ones. Going Merry is your best source to find those external scholarships. Having an EFC of zero does not mean the school will cover the complete cost of attendance which, in your case, equals your financial need.
After the amount your school is covering is subtracted, the remaining amount is called unmet need. One great way to help with this is to apply for outside scholarships. Going Merry is a great way to find and apply for outside scholarships efficiently. Sign up for an account here , or read about how it all works.
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