Bright Start(529) savings a disadvantage?

Paying for College
1

<p>Does having a Bright Start ( 529) be a “disadvantage” for us, increasing our EFC even if family income reduced to one wage earner because DH has lost his job for a year now? </p>

<p>DD has high potential of getting merit scholarship being in top 5 percentile, ACT score, Extra CC, but we are hoping for financial need merits too.</p>

2

<p>It’s not really a disadvantage. It will be assessed at the parent’s asset rate (5.6%) so it’s not a big hit. Getting good merit is certainly one way to get around that.</p>

3

<p>It is a huge advantage. Imagine what your child’s options would be if you had no savings!</p>

<p>Most places don’t meet financial need, so even a small amount of savings can give a student many more options.</p>

4

<p>In fact your EFC should be deceasing if your family now only has one wage earner.</p>

5

<p>It is always pays to save for college (as long as too many assets are not held in the student’s name outside of a 529). Savings are critical to avoid excessive loan burdens and to provide a financial cushion. </p>

<p>The ability to use savings towards some of the costs of college often is critical to allow a student to avoid loans with high interest rates and to minimize the need to work during the school year.</p>

<p>Remember, most colleges do not meet full financial need. Also, some colleges will not admit a student if they do not believe the student can afford it. Colleges assume that a large percentage of their enrollment will need some form of discount in order to afford it, but they try to avoid too many students who need a huge amount of aid.</p>