Does high % of income deferral effect EFC under CSS/ PROFILE

parentsofsboys
Fri, 30 Nov 2018 17:01:05 +0000

Hi private ID:
Yes, it sounds like we are in similar situation. Replies to your numbered observations. A few questions under #4.

1. “Do not assume your kid will get into a meets full need school.” Yes, this was my main takeaway from this thread - an ah-ha moment that made me realize we need cash flow and to back off deferrals.

2. RE: “financial gymnastics”. For peace of mind, interest in the subject and realizing one should know fully where your earnings go, we have always employed some degree of tax and retirement planning. While this can certainly - if taken to extreme - lead to “financial gymnastics”, to me it leads to less regret and a realistic lifestyle/ spending within means.

3. Yes, sound like we are in a similar situation - concluding we need more cash available during the college years and so are reducing retirement saving during college years.

4. Thanks for the helpful heads up on the AOTC, I had not factored that into cash-flow - this is a full tax credit - offsetting $2,500 in Federal tax liability and not offsetting income, correct? RE; Loans - We would also plan to max out any subsidized loans offered and plan to pay them back in full before any interest is charged, but are having a hard time determining if we/son is likely to qualify for interest deferred/ subsidized loans on $84,000 AGI/ $84,000 earnings. Any perspective here?

5. RE; “feelings about putting yourself in the best position to get as much FA as possible”. I can see how “financial gymnastics” could lead to gaming any system, if one were dishonest and learned how to exploit a situation. I don’t feel I am taking advantage of anyone or any situation. I feel a certain level of responsibility to educate myself about consumer finance, behavioral finance, taxes, health care, social security, retirement planning, etc… and now college funding. Otherwise I feel it would be like walking into a party without speaking the same language as those in attendance or onto a playing field without knowing the rules.