Funding your Future!

Seven ways to help your child get more money for college

BY LIZ WESTON

(The author is a Reuters columnist. The opinions expressed are her own.) (Follow us @ReutersMoney or here) Editing by Lauren Young and Lisa Von Ahn)

(Reuters) – If you know much about college financing, you probably know the basics of improving a financial aid package: Save in your own name, rather than your child’s, fill out the Free Application for Federal Student Aid as soon after January 1 as possible and look for scholarships and other “free money” that can reduce your costs.

But many other strategies can also increase your financial aid. Here are seven of them:

SEEK OUT GENEROUS SCHOOLS

Most colleges and universities do not provide enough scholarships, grants, loans and work-study to pay for all of their students’ expenses. Some, however, are committed to filling 100 percent of those needs, and they are the colleges to seek out if you really want to reduce your costs, says Lynn O’Shaughnessy, author of the book “The College Solution” and website of the same name.

Typing a school’s name into CollegeBoard’s “College Search” function (www.collegeboard.org/) will show you the percentage of student expenses the college meets and the average size of aid packages.

SPEND DOWN STUDENT ASSETS

Before applying for financial aid, you can spend down savings, brokerage and custodial accounts in the student’s name as long as what you buy benefits him or her, says Mark Kantrowitz, senior vice president of the Edvisors network of education resource sites.

The author of the upcoming book “Filing the FAFSA,” Kantrowitz says the spending cannot be for expenses the parent is typically obligated to provide, like food, housing, medical care, etc.

But summer camp, a new computer or tutoring may all qualify. Check with a tax pro.

SEND SOMEONE ELSE TO COLLEGE

Your “expected family contribution” will drop when you have more than one family member in college at the same time, O’Shaughnessy says.

“While (the expected family contribution) might be $30,000 for one child, when you have two in school, the expected family contribution for each child drops to $15,000,” she says.

A smaller expected family contribution typically means more aid per student.

If your kids are close in age, it may make financial sense to have the older one put off enrollment or get requirements out of the way at a cheap community college first.

MOVE MONEY INTO RETIREMENT ACCOUNTS

Qualified retirement accounts such as 401(k)s and IRAs do not count as assets when calculating financial aid, says college consultant Deborah Fox of Fox College Funding.

Maxing out retirement savings opportunities for yourself and your kid in the years leading up to college can help you move money from “countable” accounts to ones that will not affect your aid package.

But do not contribute money you expect to use for college expenses, since withdrawals from retirement funds can trigger taxes and penalties, and will be counted against the next year’s financial aid offer.

PAY OFF DEBT

You can make savings and other non-retirement accounts effectively disappear from financial aid formulas by using the money to pay off debts such as auto loans and credit cards, Kantrowitz says. This also can help you reduce your expected family contribution on the FAFSA, although the private school form will take into account your increased home equity if you are paying down a mortgage

Another way to reduce savings is to accelerate a planned purchase. If you plan to buy a new car in the next few years, for example, you might consider using your cash to do so before the student’s senior year in high school.

CHANGE YOUR CUSTODY ARRANGEMENT

The FAFSA asks applicants to list the income and assets of the custodial parent’s household. In the case of remarriage, the income and assets of the stepparent are included as well, regardless of whether he or she plans to help with school expenses.

Having the child move in with the less affluent parent can result in a larger aid package. In the case of joint custody, the “FAFSA parent” is the one the child spends more time with, so it may be enough to simply extend his or her stay at one household.

LOOK AT THE SIMPLIFIED NEEDS TEST

If your family income is low enough, you may qualify for the Simplified Needs Test, which disregards your assets when computing your expected family contribution.

To qualify, the parents’ adjusted gross income must be under $50,000. All family members must be eligible to file simplified IRS forms (1040A, 1040EZ), exempt from having to file tax returns at all or are eligible for certain federal benefit programs, such as free or reduced price-school lunch, Supplemental Security Income or food stamps, Kantrowitz says.

If your family income is just above the $50,000 mark, you could see a significant increase in aid by lowering it, particularly if there are assets that would otherwise be counted against your student.

StarProject GRAD Houston Scholarship Program

Deadline is February 14, 2014

The Project GRAD Houston Scholarship Program provides financial assistance toward a college education to eligible seniors of (Davis, Reagan, Wheatley, Yates, and Sam Houston Math, Science, Technology Center) in Houston, Texas. Each qualifying student is awarded up to $1000 annually, for a total of four years. The scholarship award amount is based on a calculation each year pending available funding of your unmet financial need before loans, and is limited to a maximum of $500 per semester, pending available funding and the student’s continued eligibility.  If you have any questions, please call the Scholarship Office 832-325-0451.

More information here.

Link-Up Houston

Link Up is an opportunity to unite the community to improve the lives of all youth in Greater Houston. The conference is for youth, parents, educators, school leaders, faith communities, youth workers, business and community leaders, city and state officials and other stakeholders to learn how the Search Institute’s 40 Developmental AssetsTM can improve our lives and strengthen Houston’s future.

Link Up will:

  • Address the needs of Houston’s multicultural population
  • Bridge the gap between generations
  • Engage all for a safe, drug-free Houston
  • Increase assets in youth
  • Strengthen families and parenting skills

We want Link Up Greater Houston to:

  1. To inform more young people and adults about the 40 Developmental Assets;
  2. To inspire young people to add the assets that they don’t have;
  3. For every adult who works with youth to know the importance of building positive, caring relationships with all youth; and
  4. To inspire relationships with young people by adults and also to let young people know that they can help their peers.

National College Fairs Logo

Houston National College Fair

The National College Fair is an annual fair for students and parents that provides tools that help their transition from high school to college. Attendees meet with national college admission representatives, receive resources to support the college preparation and search process, as well as help applying for, paying for, and succeeding in college. Over 250 counselors and representatives from colleges and universities meet with students and their families to discuss admission and financial aid opportunities and informational workshops are held. Admission is free.

Register for the National College Fair

Houston National College Fair

Thursday, February 13, 2014
Reliant Center
8400 Kirby Drive Houston, TX 77054

Important Resources:

https://fafsa.ed.gov/index.htm

http://studentaid.ed.gov/resources#grad

http://studentaid.ed.gov/types/grants-scholarships/finding-scholarships

http://www.questbridge.org/about-questbridge/our-programs (For current HS Juniors especially)

http://www.nationalmerit.org/nasp.php

Don’t for get to Tweet this blog post!

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