My daughter is a HS sophomore on reduced lunch. Right now she qualifies in net price calculators for tons of no loan aid at colleges and low income scholarship opportunities. I am worried that this is not the year to take this job and impact these opportunities. We are almost halfway through the year. Should I wait to get a better job? She also gets free ACT and SAT testing, some free reports, application fees to colleges waived. I suspect I will have to pay for all that thus minimizing the impact to our lives.
You know…getting a better job is an investment in your future. I always think getting a better job is a good choice.
Your daughter is a HS sophomore. You are currently using net price calculators for 2018-2019 entering freshmen.
In addition, you are assuming she will be accepted to colleges with NO LOAN policies, most of which are highly competitive. That might happen…and it might not.
For comparisons…do those current NPCs with your anticipated NEW higher income…and see what happens. Remember, however, these are NOT the NPCs your kid will be using when she applies in a couple of years. But it will give you an idea.
It sounds to me like you have a great opportunity to improve your family income. In my opinion, that is a long term investment for your family.
Your daughter can look at less costly options for college.
Don’t give up a long term benefit for a short term one. Over time, the money from the better job is going to be more than anything you save on fee waivers and free/reduced school lunches. You don’t know where your daughter will wind up for college, so don’t make plans based on acceptances that haven’t been offered. FWIW, you may still be eligible for Pell and other low income benefits at 42K.
Some generous colleges give full need-based aid if family income is less than $60,000.
You can use the net price calculator for each college to see how much you will get.
I agree with @thumper1 that the opportunity to gain more income is always better.
One more vote for: if you have a better job opportunity- take it!
Even with the new job and $12k in extra income, you may still qualify for some need based program like free/reduced lunch, SNAP, LEAP (heating assistance), so your child may still qualify for free ACT/SAT reports. Apply for the programs even if you don’t think you’ll qualify. Your 2018 income won’t be $42k because 1/3 of the year has already happened.
Oh gosh, take the job. Your quality of living will go up. Your daughters opportunities and security will increase now. College aid (outside a 4 year merit award) are set annually. Do you really want to keep your current income the same for the next 5 years? That’s like 60k! Take the job, pay off any credit or cars loans. Get yourself in the best position to start off in.
I have no idea what the financial cut-offs for free SAT’s and applications but I know we spent less than 1k on testing multiple times, sending financial reports and for 10 college apps. You don’t want to give up an increase of 12k this year to save 1k in college app costs.
I habe no idea of your full situation but 42k total income is still likely to qualify for a lot of aid depending on the schools you child is looking at.
Just to play devils advocate, is everything else equal between the new job vs current? WIll it require a longer commute, worse hours, etc.? Is it a new part time job on top of a full time job? Do any benefits change - like health insurance - could your health insurance costs increase for a worse plan?
While I agree that it is usually a good idea to go for the higher paying job, it is relatively easy to predict situations where it does not make sense overall, at least for the time being
Take the better job…
Very few colleges have no-loan policies. Very few. And those that do are the tippy top schools where only a tiny percent of applicants are admitted. And those schools use css profile and usually require the financial info of any non-custodial parents. Does your child have a NCP?
Most schools do not meet need no matter what your EFC is.
Take the better job. Save some money into a protected retirement account. Likely, with your current income, you may not have much saved for retirement.
I doubt it will affect financial aid too much.
^^^
Agree. 42k is still low/lowish income. And the idea of giving up 13k per year for the next 7 or so years is crazy. Not only is that a lot of money to give up, but declining the new job is a terrible idea for career and financial success.
Still qualifies for free testing and likely free/reduced lunch.
tell us more. How strong a student is your daughter? Has she taken any psat ACT/SAT tests?
actually we will be using THIS years income for FAFSA. Also Questbridge has an income cap. at the increased income I do not qualify in my state for any of the fee reductions or scholarships Maybe you live in NY or CA or something.She is an extremely strong student. Not worried about that.
I have done the research and it will decrease financial aid by about 3k more a year. I am sorry I posted this. I think I have figured this out though research.
If you do your research you can as I have find the colleges that have no loans in their packages. you need to do more research.
Yes! this is EXACTLY my dilemma. the increase will put me OVER.
no…actually it is only 42k…before taxes
I loose flexibility and have to find away to get my daughter to and from school everyday. Also will have to invest in office work wardrobe. Have a uniform now. I am not pursuing this any more. I am in the running for another job but we are fine and the opportunities are more important.
Even if it costs you 3,000 in lost financial aid, the 12,000 raise is still worth it.
Assume your new salary will be collected for junior and senior years of high school plus four years of college - so you’d get 12,000 x 6 = 72,000 more in income and 3,000 x 4 years of college = 12,000 less financial aid.
You are “ahead” about 60,000.
You have two years to figure this out…in which you could be earning more money for your family.
It sounds like you are sure your kid will be accepted to one of the highly competitive colleges that meets full need for all accepted students…with no loans in their financial aid packages. Right now, those schools have acceptance rates in the under 10% range. This means that 90% of applicants or so are rejected from these schools. Most rejected applicants have excellent admissions stats…just like your daughter does.
These schools are NOT a slam dunk for admissions for anyone…unless you are a U.S. president or have the money to donate millions for building funds.
Also, MOST of these schools have very generous need based aid, even full rides at some…for students with incomes under $60,000.
You need to do better research.
What state are you in? Household size?
You can reduce your federal taxable income by investing in a traditional IRA I believe.
Untaxed income still counts for FAFSA, but maybe not for reduced lunch.
What is your FAFSA EFC with the old income, and with the new?
You can check that here https://bigfuture.collegeboard.org/pay-for-college/paying-your-share/expected-family-contribution-calculator
(federal methodology), it uses the 2018/19 FAFSA EFC formula (right now).
I agree with others, an increased income still benefits you. You can save some money for retirement/college.
You will gain more than the $3,000 you might lose in aid.
Nobody knows what the federal aid program will look like in a few years. More money is better.