Financial Aid Emergency--Help?

Paying for College
1

Hi everyone,

I have a bit of a dilemma with my status as a financial aid candidate for college apps next year (I’m class of 2018/2022).

My family has always been lower middle class. I only have one working parent, and our income is always around 65k. I attend a private parochial school, but my tuition is completely covered by aid. I qualify for free/reduced lunch, fee waivers, all that stuff.

Just last month, my grandmother passed away. She had a really significant estate, and even after dividing it by 6 kids, my family will be receiving about 150-175k in estate money (wasn’t big into sharing when she was alive haha). The money is coming in the form of an IRA of about 50k, investments in a mutual fund around 100k, and then a chunk from the sale of her house and precious metals.

My parents have always made it very clear that I a responsible for paying my way through college. I’ve always been counting on financial aid, especially at schools that cover demonstrated need. Most schools I’m looking at are very affordable to my family on our current income, but this new money coming in sometime this spring will throw that off.

This money will be saved for retirement in the IRA already coming, and some towards the purchase of a vehicle. None will be left in a savings account or any investments.

My concern/question is that this is going to make me look much better off than I really am on FASFA/ PROFILE. It’s my understanding that new FASFA guidelines ask for your junior year taxes (which this will not be under 2016 taxes, they’ll be on 2017 taxes), but I’m concerned about PROFILE and even aid packages for my sophomore year at college.

Is there anything that makes this situation any better? Will I be able to explain my situation to aid offices? Or am I screwed…?

2

this money will be coming to your family in 2017, so no affect now or next year.


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The money is coming in the form of an IRA of about 50k, investments in a mutual fund around 100k, and then a chunk from the sale of her house and precious metals

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I think the money in the IRA won’t count at all.

As you’ve stated, the other money will be spent and won’t be in savings.

I don’t think your aid will be affected. You don’t need to say anything to anyone at this point.

I’m trying to remember if inheritances count as income. I don’t think so…but anything sitting in a non-retirement account would be savings.

If your parents have any money left over, they need to get it into a retirement account or pay off their home mortgage or something like that.

3

I don’t think so either (similar to life insurance death benefits), but if anyone has written evidence to the contrary from the Dept. of Education or College Board, I would love to see it.

As noted, if the money remains in or is invested in a qualified retirement account, or it is spent before parent financial information needs to be reported, it won’t be a factor in financial aid determinations.

4

The inheritance will count as assets, not income. From personal experience.