I am planing on transferring to a UC school fall 2016 (UC Irvine), and want to start looking at finantial options well ahead of time.
family’s EFC is minimal, 500-1k. I am receiving no aid from them, but can stay home to minimize dorm fees etc. It looks like my EFC will go up by 4-4.5k to ~5k from my savings using online EFC calculators.
is there a legitimate/ethical way to minimize my EFC portion?
if not I might spend ~8-10k on a decent used car. I might be commuting 45-60 min to school, and have an old 300k mile beater that I would be willing to try and make it through college with, but it would make more sense to not worry about 1k in repairs every year and the EFC + repairs combine for a 4k subsidiary in their own way.
Legit way = put your savings into a 529 plan and it won’t count as your asset for FAFSA. It may not count as your parent’s asset either if that amount plus their savings is less than the asset protection amount (depends on their age - how much do your parents have in the bank, in stocks, under the mattress?).
Student savings = 20 percent assessment
Parent savings = 5.6 pct assessment
I don’t know why your EFC will go up though if you already have that savings. You can’t have 2 EFCs. You are calculating before and after that savings? I shouldn’t go up by the while amount. Otherwise you can ‘pay’ your parents for room and board and have them buy a car for you if you need the car.
I have no idea what you mean EFC+repairs combine for a subsidiary. what subsidiary? There are already transportation costs in the COA for living at home, that is higher than students dorming. 800 vs 1,600 at Irvine, for instance.
Do you qualify for Cal Grant?
Why dont’ you pick one of the UCs and run the Net Price Calculator? At your income you might get everything paid. Try living on campus and living at home to see what gets covered at your lower income level you might be surprised.
hmm. I will look into that 529 plan. my parents have pretty much no assets, so it probably would be sheltered.
net price looks to be around 25k and I can expect to receive ~12k in aid, does that sound about right?
@BrownParent I mean that if my savings adds 4k to my EFC and I can reasonably expect to spend 2k on repairs over those two years, that is 6k I’m loosing. if I buy a car for 8-10k I do not have to worry about the 2k in repair costs, and I will have ~2k lower EFC, which means that my net loss for buying a reliable car is actually 4-6k. my current car gets ~17mpg and the car I’m lookin at (first gen scion XB) gets ~30 MPG. that translates to a very real 1k savings in gas over 2 years, though I do not know how it will affect insurance. in the end 4k-6k for a reliable car may be worth considering.
Having a reliable car will allow you time to concentrate on your studies - which may be priceless.
I like the way you are thinking.
Which tax form do your parents file? Since you say their contribution to EFC is $500-$1k they sound low income. If they can file a 1040A for 2015 and have an AGI under $50k, then you would qualify for the fafsa simplified formula where neither your nor your parent’s assets would add to your EFC. One problem for filing a 1040a for 2015 could be if they itemized deductions for 2014 and will have a state tax refund to declare as income for 2015 taxes. Or do you have younger siblings who receive free/reduced lunch?
The criteria for the simplified formula starts on page 4 and the simplified formula starts on page 13 at this link:
http://ifap.ed.gov/efcformulaguide/attachments/090214EFCFormulaGuide1516.pdf
This assumes things stay relatively the same for the 2016-2017 fafsa.
@annoyingdad I don’t know what form they filed, I will look into that and see if we are both eligible for a 1040a
otherwise I will look into this 529 plan for my savings