nunya

Ok, so I just went through the FAFSA4caster and missed this or it wasn't there. Anyway, where would I enter a pre-paid (not 529) plan? Also, I'm now hearing that for planning ahead, I messed myself over because it's going to penalize me on the FAFSA. Is this true?

FauxNom

On the CSS Profile you include it in parent assets if it's in the parent's name, otherwise in kids. I haven't gotten to the FAFSA yet, but maybe this reply will point you in the right direction.

If it's treated as a parental asset, I wouldn't say you messed yourself over. You still got the tax benefits

kelsmom

The value of your prepaid plan is listed on the FAFSA as a parental asset (part of investment value). http://www.fafsa.ed.gov/fafsaws90c.pdf. Go to Parent Asset Value. You will see the instructions for net worth of parent investments. You use the refund value of the prepaid plan at the time you file the fafsa --- there should be a website for the state where you can get that value (in Michigan, we go to our state government website & we are able to look up refund value online). Because there is protection for parent assets, this doesn't hurt you. The money from the prepaid tuition is not used against you in packaging financial aid, which is also a good deal.