<p>Y’all are so helpful on this forum, I’m hoping you can answer a question. My son will be attending a state university and will live at home. We have prepaid tuition and fees for him, and he has also earned bright futures. What happens if the cost of school is less than these two resources combined? He is planning on going away to school in two years and we would like to save a portion of that money to help him out when he goes. I’ve read some posts here that say the school reduces the amount of financial aid if the need goes down. Will he receive the bright futures if he earned it, but technically doesn’t need it? Thanks for any help.</p>
<p>I don’t think BF is tied to need. It’s not a need based grant, it is a merit based award so it shouldn’t be reduced. Need based aid is reduced when there is less/no need. That’s not usually the case with merit based money.</p>
<p>BF is an entitlement so if more money goes into the school account than the charges, the excess is usually refunded after a few weeks into the semester. However, schools do have their own rules on this sort of thing so you have to check that out with the school. As for your prepaid tuition plan, it depends on how that works. If it just ships the tution and fees amount to the school, then it all goes onto the school account and the excess is refundable through the school. Usually, payment of these sorts go to the school, who takes out their share, and you can then take the access and put it in a 529 for the years when he ends up boarding Be aware with 529s, you do have to spend the money on school related expenses as specificed, and there is a penalty if you want to take the money out for anything else, so if that is an issue, possibly having too much stashed that way, you might want to put it away elsewhere without such restriction. </p>
<p>For financial aid purposes, parental and 529 assets are assessed at about 5.6%, after the asset allowance for the parents are exceeded. Kids other assets are hit at 20% with no exclusion allowance.</p>
<p>He’ll receive Bright Futures off the top. Then, any grants will be applied (yes, the value of the prepaid is considered for financial aid purposes) and then the Prepaid Plan will be applied. You will designate how much you need paid out and you can either leave extra funds in the account (for use later), ask for a refund or transfer unused funds to a relative. Here is the answer on the faqs of their webpage. They are also really helpful if you want to call with a question about your account. 800-552-GRAD(4723) </p>
<p>[Enrollment</a> FAQs | FAQs | Florida Prepaid College Plan](<a href=“http://www.myfloridaprepaid.com/compare-plans/enrollment-faq.aspx?plan=ppd]Enrollment”>http://www.myfloridaprepaid.com/compare-plans/enrollment-faq.aspx?plan=ppd)</p>
<p>“If your child earns a scholarship, such as Florida Bright Futures, you still can use the full value of the Florida Prepaid College Plan. The combination of the scholarship and the Prepaid Plan may cover more fully the student’s college expenses. Your alternatives are to request a scholarship refund or transfer the Prepaid Plan to another family member.”</p>
<p>Thanks so much everyone. That helps a lot!</p>
<p>With the 529, is there a restriction on transferring the funds to another child or to another university?</p>
<p>Yes, you can use it for a college in the U.S. that is not a Fl public. You will have a choice whether to pay out based on the per-credit FL tuition or based on what the other school bills. Obviously, you will go throug your prepaid much faster the latter way.</p>
<p>As far as restrictions on transferring to another person, yes, check the link I posted above because it goes on to explain those restrictions. </p>
<p>Besides the fans, you may want to check out the forms under the prepaid tab.</p>
<p>
When you say financial aid purposes, do you mean financial packages and how it affects what your receive?</p>
<p>Yes. The value of prepaid tuition is considered an asset for the parents which must be reported on the FAFSA. Parents get a good bit of asset protection, so it won’t make a huge impact on aid eligibility.</p>
<p>Do schools consider it a resource?</p>
<p>No. It used to be considered a resource, but in 08-09 it changed from a resource to a parent asset. The result is more favorable - it is treated like savings (which it should be, IMO - as opposed to a resource).</p>
<p>The school considers the value of prepaid tuition as an asset of the parent, yes. But parents get a certain amount of asset protection. If the value of all assets including the prepaid tuition plan exceeds the protection amount, then the excess is assessed at 5.6% towards EFC as any and all assets are except those specifically protected by FAFSA Rules (primary home, 401 K plans, etc).</p>
<p>Ahh, ok. Thank you guys both for clearing this up.</p>