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Financial Planning / Paying For College


Subject:  Re: Paying for College and Aid Date:  2/24/2013  3:09 PM
Author:  foo1bar Number:  8021 of 8484

I have alot in my 401k but don't want to touch that and I have my home almost paid off.
Neither of those are assets considered for FAFSA.

park it in a 529 for each of them locking in current tuition?
Are they definitely going to a specific institution?
And does that college have ability to lock in current tuition?
If answer to either of those is "No", then what are you really asking?

Will having liquid cash affect financial aid?
Whether it's invested in stocks, bonds, or cash under the mattress, all of them are assets that count toward expected family contribution.

Is it better for them money to be in my name or theirs?
Most likely answer:
Your parent's name.

Then yours (it can be in a 529 or elsewhere)

Then the student's name.

(Assuming they're dependents of yours, 20% of their assets are expected to go to college costs, while only 12% of your assets are expected to go to college costs.)

BTW: you're pulling $70K out of home equity (which is not counted as an asset for FAFSA) and putting it into a regular investment account (which is counted as an asset for FAFSA)
That doesn't seem like a prudent move to me.
If I were in your shoes, I'd probably arrange for a HELOC if I know cash is going to be tight. Sure it'll be an adjustable rate - but the rate is very low right now and probably will be pretty low for the next 5 years - and I'm *assuming* that it's something that's short-term
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