<p>Not to mention the fact that if you think people with high incomes, or even moderate to low incomes, qualify for “government” programs such as medicaid you are mistaken.</p>
<p>Just this month I have interviewed a number of people who are disabled–yes, really disabled, believe me, you would not want to have their issues–and live in subsidized housing. They get about $650 per month, plus medicaid and some food stamps. They pay $200/month rent out of that for a studio apartment. They pay their own utilities. They are not living high off the hog. That is the reality. (BTW, a significant number of these people have none of their original teeth, or only 2 or 3, even though they worked at low-paying jobs for years. The local dental clinic will pull a tooth, but will not install a crown. For that, you have to have money or private insurance, and their jobs never offered insurance.)</p>
<p>^ When my oldest was approaching college, I actually made the calculation for my wife.</p>
<p>If you consider the 47% that FAFSA assesses income over a very low amount to be like a tax, the incremental tax rate on her income approached 80%. When you add up the extra expenses of working, you are looking at 85% or even higher. It’s a huge disincentive from working…</p>
<p>… except that there is little chance of getting that 47% back as “free” money from colleges, in most cases. And you’d have to quit your job a year and a half before you know if you will get the free money. It’s a pretty big chance to take.</p>
<p>To OP, I believe that f the federal government qualifies you as poor by granting TANF, WIC, foodstamps, welfare, you automatically have an EFC of 0 assigned and do not have to provide any additional financial information.</p>
<p>Fly, that’s not necessarily true. You also have to have an income less than 23k. My family and I qualify for food stamps and I have an above 0 efc now.</p>
<p>The cheap way to do that is incorporate a lot of beans and lentils in your diet (as is common in poor countries), which provide decent amounts of protein and fiber, while the carbs are slower digesting (which can help against blood sugar control issues in people who do not exercise or are obese).</p>
<p>Of course, people who eat a low-carb diet may find it difficult to eat inexpensively if they want to eat healthily.</p>
<p>Pizza, obviously different people need different diets. We incorporate a lot of lentils, beans, nuts, etc for protein. My mom is in her 50s and still eats like I do. She has to monitor her health and diet pretty carefully and it seems to work :). I should also add that we drink soy and almond milk because we can’t tolerate much cow milk (a very recent, unfortunate development for me).</p>
<p>Wow. The OP seems seriously paranoid that rich people are going to get FA for their kids.</p>
<p>My understanding is that the only way very wealthy people can appear low-income for purposes of FA is to defer income or take a lot of invest income a year or so before the year before the kid matriculates but none or not much invest income right before they matriculate. So in this sense, I guess, some wealthy types might manipulate their investment income stream to enable their kids to get FA.</p>
<p>Wage earner high-income types cannot. And, btw, their net wealth does not factor into the equation. They can have zero net wealth but if their income is across a school’s FA line, then presto – must pay full freight.</p>
<p>My own take on this situation is that the system by which FA is determined is seriously awry. It mimics our tax code in that it is progressive, i.e., families pay increasing levels of tuition as their income rises. Then there’s a full fright price that gets hit and the 150K household is paying the same tuition as the 5 million k household. That is not how our taxes work and it seriously benefits the very, very wealthy. </p>
<p>Also, if you think about it, colleges are forgoing enormous sums of tuition that they could be reaping if they would make the tuition charged progressive across the entire range of incomes. Why should Eliot Sptizer have paid the same tuition for his D at Harvard as we did for our S? He earns and is worth many, many times what we are worth as a family.</p>
<p>OP, look at the thread at the top of the Parents Cafe about retirement. One of the biggest issues that this family may likely face is not having assets for retirement and having to figure out how to support themselves through retirement, especially if they have no savings, no emergency fund and perhaps no retirement or other assets. There are unfortunately many people who make financial choices that may not be best for their long term financial health.</p>
<p>I agree. And that is one of the things that concerns me the most about this hypothetical family. As someone who has ample financial resources, obtained through years of hard work and sacrifice (not lottery winnings, lucky stock picks, or right place/right time), it concerns me that I will feel pressure to help them out financially. </p>
<p>And that will be difficult - nobody wants to see others living on the street, but we also get to sleep in the bed that we make for ourselves. </p>
<p>Life is full of choices. You can wipe your shoes or mop the floor. Or see if your neighbor will mop the floor for you after you decided not to wipe your shoes.</p>
<p>Obviously I don’t know these people but are they really “poor”? My sister always says they don’t have any money to go out for dinner or do stuff, BUT, to them, not having any money means that the $231.43 they budgeted that month for “entertainment” has been spent and they won’t do anything until next month, however, they have VERY healthy retirement accounts, etc. I have never seen a family budget to the penny like they do-they seriously set aside that .43 or $21.38/month for car repairs or $284.85 for something else–and have bank accounts for each of these funds. So, in reality, they are no where near poor, but they are very disciplined savers–and probably better off than you are engineer4life :D.</p>
<p>It is really hard to know anyone else’s finances, unless you’re their CPA/accountant & have access to ALL their finances. People spend/save in different ways. Some of my relatives are VERY frugal but live in gorgeous multi-million dollar homes while others are very generous but live in much more humble abodes. Priorities and how people choose to spend/save vary considerably.</p>
<p>I think it’s important that each of us makes financial choices that work best for us. If a loved one is making financial choices that we feel may have us “on the hook” in the future to help them keep from being homeless, we need to figure out if there is something we would like to do to prevent this from happening, whether it is asking if they’d like some hours with a financial planner or other finance professional (which way may fully or partially pay for).</p>
<p>Folks are all very different as to how they choose to use/conserve resources. One of the most frugal people I know is a relative who has many times the resources we do but rarely chooses to dine out (when he does, it is usually for lunch). He has invested and owns a condo for 3 of his 4 kids, as well as having education accounts for all of his kids, good pension for him & his spouse, is paying full-freight & private school tuition (he does greatly value education). He is very generous and often offers to host gatherings at his gorgeous home.</p>
<p>Slightly off topic, but in response to a point raised up thread, rising grain prices almost always cause meat prices to fall initially, as ranchers cull their herds. This increases meat supply in the short run, causing prices to fall. In the next year or two, however, herds are smaller and feed costs higher, driving meat prices up.</p>
<p>This should really have been the first post, because the OP would like to be reassured that it’s OK to say no to requests for financial help. </p>
<p>Yes, it’s OK to say no to requests for financial help. Which is not to say that everyone posting here would say “no” if they were in your shoes. There is no one size fits all answer to this, because circumstances vary. HImom pegged it exactly right.</p>