<p>To answer the question in the original post – no, it doesn’t (and I do have a degree in economics!).</p>
<p>The only way the OP’s friend’s analysis makes sense is if she has figured out that her net pay (pay after taxes) would be less than the amount of non-loan aid that her child would be eligible for if she didn’t work. The 50% reduction in the amount of aid she talks about is irrelevant; only the actual dollar reduction in aid should be considered. And it doesn’t make her work “tax” 100%.</p>
<p>If she were to make $30,000, net $15,000 and her child would lose $15,000 in non-loan aid, then her working would be a wash. But if her child would lose less than $15,000 (for purposes of this example) in non-loan aid, than the family comes out ahead financially if she works. </p>
<p>I’m assuming that she realizes loans just delay the day-of-reckoning and only non-loan aid is relevant to her decision. And also that she realizes that she is looking at this purely as a short-term financial decision; I certainly would not.</p>
<p>We will be full pay wherever my sons attend college (although the older one did get a merit scholarship at his school). My husband and I both work. I would have it no other way. More money gives you (and your children) more choices and more control. </p>
<p>BTW, I did work part-time when my boys were younger. It was a good trade-off for us.</p>