My family runs a business which lost a significant amount last year (800,000) while making an income of 350,000. I don’t know if I will be eligible for financial aid since my income is technically high but clearly the gross income isn’t. Thank you!
Please clarify. Was your parent net income $350,000?
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gross income was -$450,000
What was your parent NET income?
Can you please explain why you are asking? The reason I ask is because there are several responses to your question, but I need to know why you are asking so I can tailor my response to your situation.
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What is net income? Is it the total amount made before any losses?
I’m worried that I won’t get any financial aid for college since my situation is somewhat unique. We don’t have any savings left so would have no option beyond loans. I just was wondering if it’s worth putting in the effort I am right now for ECs and grades if I won’t be able to afford going to a good school.
Are you a junior or a senior?
I’m a junior right now and was making a preliminary college list
It absolutely IS worth putting in your best effort. It will open up more doors the better your grades, etc are.
With a complicated financial situation like yours, it’s possible you could receive merit aid to fund at least some of your college costs.
Any college is a “good school” if it will get you a bachelors degree in your field of interest.
Did you take the PSAT this year? Do you have the results? Any chance you are a NMSF?
What is your current GPA?
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That makes sense—I can see why it would definitely help. I got a 1510 and have a 4.0 unweighted with a 4.7 weighted. I already took my SAT and got a 1560 on that.
What was your PSAT score? 1510?
@AustenNut any suggestions for large merit aid colleges for this student to consider?
Yes—I just checked and the score index was a 226 if that’s relevant at all
Are you a National Merit Semifinalist? If so…look at University of Tulsa, University of Alabama, University of New Mexico. IIRC, all of these offer very generous merit aid to NMSF.
@tsbna44 can you elaborate?
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Step 1. Talk to your folks about a budget. His way you know what you have to work with her year. Is it $10k or $30k or $50k or $90k. Obviously not the last.
But with the budget, you can build a path. If your psat gets you national merit semi, you could get a full ride.
There will be a great college for you but you need a budget first.
You may (or may not) qualify for need aid - but setting the budget will help us help you find schools that could work should you have to pay.
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I’m assuming I will be but don’t know if I am yet.
Okay, I’ll get back when I’ve talked to them about it. I doubt it’ll be that much but we’ll see. Thanks
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Still a first step. College can be anywhere from $20-$90k plus.
You have to be flexible is all.
But if you find you have need, who knows - even lower.
I think they will better understand your finances than you. Sometimes businesses can show a loss but still generate free cash flow.
I suspect you’ll be fine. Congrats on a great record.
Okay, so you will be using 2023 information when you file for financial aid. The form will walk you through how you should report information. Business owners report income differently. Some report everything on a Schedule C or have income from a S-corporation; this is reported on Schedule 1. Some draw a W-2 income from their business, which is reported as wages on line 1 of the 1040 tax return. Look at the parent income section here to see what is requested: https://www.reginfo.gov/public/do/DownloadDocument?objectID=130199102.
I suggest waiting a few days until the 2024-25 FAFSA is available. Soon afterwards, you’ll be able to find good calculators that will allow you to plug in your parents’ 2022 tax information so that you can get a good idea of what kind of federal aid you might qualify for. Basically, you want to know if you are eligible for a Pell Grant. If not, you will only be sure of getting federal loans (maximum of $5,500 freshman year). You could use the SAI estimator, Federal Student Aid. I’m not sure how accurate that is, but they should have fixed their glitches by now.
Business owners can’t always get a good estimate for aid, because schools that have a lot of their own aid to award will often use the CSS Profile. They may add back business deductions. You would want to talk with individual schools if you have questions.
Getting a good budget from your parents is definitely the place to begin. From there, you can start investigating schools. Going for merit is a great idea, as is looking at your state schools. There are some good ideas for you in posts above.
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@monkae99, what are you interested in studying? Do you have preferences in terms of the size of the school, location of the school (urban, suburban, small town, rural), region(s) of the country, importance of intercollegiate sports enthusiasm or Greek life, etc? Once you get your budget and let us know what you’re hoping to get from your college experience, we can brainstorm ideas that will try and hit as many of your requests as possible.
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