ethanrt

Tlesc1: Apparently, the "problem" is that my parents have about $35k in investments, which probably also made UChicago give me a pretty bad estimate. Obviously if we have over $200k in loans, the idea of the $35k is to allow it to generate as much return as possible and then pay off more loans with it at the right time - but for Georgetown, apparently the idea is that if you have money anywhere, no matter what, you're paying.

Moral of the story (and this should be posted somewhere): If you have investments and loans, and are applying to college, use up all of the investments paying loans by the end of the summer before you start applying. I'm not too despondent about G-town or anything (I'd want to go there for grad school anyway), but it does kind of **** me off that they're so, as the lady at the FA office put it, "numbers-driven" and will only grant reviews if someone dies or loses a job or something.

curmudgeon

Two years ago but Yale and Amherst were the worst by a wide margin with need aid. Colgate was astounding (Alumni Memorial Scholarship is quite the enhancer).

fastimes

This year, Colgate, Lehigh not generous at all. They gapped our EFC by several thousand. Cornell, even worse!!! Just horrible. Penn was the best offer by far.

sunshadow

I was 40 years old when I made my last student loan payment, and for most of those years was a single mother. Making that payment every month all those years was a killer for me, not to mention the interest. Now, my only child is in college and I am determined that she not go through what I went through. I am doing everything I can to avoid her having to take out loans. I explain to her my reasons and she fortunately has a solid grasp of finanances (is actually a lot more conservative financially than I). Is it wrong to help her avoid loans? I know some people feel it gives them a sense of responsibility for their education. I would rather she develop that responsibility when applying for grad school.

anxiousmom

I think some loans are reasonable - especially if it allows your child to go to a substantially better fitting university. Reasonable loans in my mind are no more than an aggregate $15,000 at graduation. (Obviously less is better! )

CountingDown

Stafford loans each year are an assumption for the students at my house, no matter what our EFC might be. (Only exception is if they accept full rides.) Total loans will be $19K by graduation, plus summer/term-time earnings, which is not an unreasonable amount of skin in the game considering the amount we may be contributing to this enterprise.

Ethanrt, $35k in total investments held in your parents' names should be covered under the asset protection allowance (which is around $46,000 for married parents), and at any rate, amounts above that are assessed at 5%. If those funds are in YOUR name, that's an entirely different story. Home equity might be the missing piece of the puzzle here.

2blue

Yale's new FA policy has certainly made a difference. They were tied at the top of the pack for us. Amherst did a pretty good job. It has done the best of the LACs for us.

Editing to add, if a kid can avoid loans I'm all for it especially if they plan to go on to graduate school.

J'adoube

Does Chicago give additional college-sponsored scholarships to National Merit Finalists besides the $1k per year that they already offered?

tokenadult

Usually that would be the financially smartest thing to do anyway, whether or not a child is applying to college.

jude_36

I just wanted to jump in here and say that I'm not sure that you can reach any kind of conclusion about which schools give 'disappointing aid offers'. From what I've been reading on lots of threads, the same school that gives a huge amount of aid to one student can gap the next student considerably. Unless you can really do an in-depth financial analysis, and also take into account what skills the kids have that the college might want, it really seems to be kind of random. I'm sure that there is method, but I'm not sure *I* could figure it out.

For example, I was talking to a parent the other night. My daughter and her daughter both were accepted to the same college. Her daughter was considering it a top pick because they were so generous with aid. My daughter has ruled it out because the aid was so poor. The school sent me a lovely letter saying that yes, they had gapped us, they couldn't do anything more, so sorry. My daughter has a higher class rank and higher test scores than the other girl, and they both have lots of EC's. But obviously there is *something* that the other girl has that my daughter does not. Or maybe it just has to do with our different financial circumstances. We both will have three children in college next year. They actually make more money than we do, but I don't know details.

So, if you asked me about the school, I'd say the aid package was a disappointment and that we were gapped. If you ask the other family, they would say the aid package was excellent and they were very happy with it. This school was not on tokenadults list of schools that promised to meet need.

ethanrt

Let me clarify something briefly for those who are confused. Tokenadult, you may want to read as well - although I'm sure you don't need it since you have proved to yourself time and again that you are clearly the wisest and most knowledgeable poster on CC.

Numbers here are very approximate in this situation, but the general idea holds and applies to my family's (and, I'm sure, others') mortgage-investment situation.
Average stock market returns per year for investments held over ten years: $2,500 and rising.
Interest payments per year: $1,500 and falling.

Would /you/ want to pay off part of the mortgage using the investment money?

archiemom

As a parent and an adult, I am constantly amazed at how confident high school students are of their family's financial situation (and how colleges interpret the same). If you live in an affluent new england town and your family owns a business and a home and has investments, then you have advantages that most colleges students probably do not have. Whether the family choses to use those financial advantages for one child's college costs is irrelevant to the colleges' financial aid office. Every bit of aid offered is a gift; no one is entitled to a top tier college education. Perhaps one could be less disappointed, and more appreciative of the free money one has been offered.

tokenadult

Thanks for the further replies. It does look like there are a lot of new ideas to consider when pondering how various family financial situations fit into America's non-system of college aid.

samiamy

my parents 18 years ago played with the numbers to decide whether to pay down their mortgage or do a college savings thing. They did the college monthly savings for about a year or so for the full amount they could, lost alot(bad timing) of the money. Switched to paying down/changing from a 30 year mortgage toa 15. They said they finished paying the 15 year 3 years early.Three years of saving the mortgage payment, now have that mortgage payment money sitting in the bank plus have that monthly money of income to more than meet our EFC. They said it was a gamble but losing so much during the 90's of tht 529 or not much return made them rethink. They said they are so glad they did not do what many of their friends did using their house to finance their lifestyle, they have 4 kids and all of us will be able to go to where ever we get into with no money worries.

DocT

archiemom: Interesting comment - another Southbury resident