Independent Student Savings???

Paying for College
1

Hello All,

I am currently enrolled in my local community college, but plan to transfer out to a University after I get my Associates.

I currently make OK money (~40k), but when I transfer out to a University I hope to quit my job so I can dedicate my self completely to my education. I have 20k saved up for college so far and hope to have 40-50k by the time I transfer.

I know that a University will consider all of my assets and, even more importantly, my last years income. Since I am going to be quitting my job, I know I can probably fill out some kind of “Special Circumstance” form (or something of the like) to try and have my FAFSA income adjusted to reflect my actual income at time of enrollment.

My real question is in regards to my savings: Would it be in my benefit to give my grandmother a “gift” of the legally nontaxable amount of 14k every year, in hopes of a better aid award? If so, could I then use that money freely to pay my necessary expenses and pay off my loans throughout my stay at college?

2

Your savings will be counted at 20% toward your EFC. If you give it to her, I think you then need to declare money paid on your behalf if she gives it back. Technically giving it means you don’t get it back. See what other reply you have.

3

A school could do as you say and base your need based financial aid not on your past year’s income but on what you expect to make in the tax year in which you start school. If you work Jan-Aug, you could still make $30k of your salary. But say the school does grant your ‘special circumstance’ request (not guaranteed), what will it get you? Pell grant of up to $5800?

And then giving your grandmother your money? What if she dies and your funds are tied up in probate? If she pays your tuition (with your funds that are now her funds) you’ll have to report that on the FAFSA for your second year.

I think you should save as much as you can and then pay for your first year with money saved, loans, and money earned. For the second year, you might qualify for more need based financial aid if your earning are low and your assets are spent.

4

Wait a minute! Having a lower amount of assets, and a lower income…and a lower EFC will NOT guarantee this student significant additional need based financial,aid at most schools…because most schools do not meet full need.

Sure. If he has low enough income, he could qualify do the $5770 Pell Grant. But really…is that worth all this financial gymnastics? Maybe.

This independent student will be able to get $10500 as a sophomore, or $11500 as a junior in Direct Loans.

5

You have a potential REAL problem that @Thumper1 is telling you.

You seem to think that by having no income/less assets that the school is now going to cover your costs. NOT LIKELY GOING TO HAPPEN AT ALL.

First of all, most schools do not meet need and give LITTLE aid. Secondly, you are a transfer student. Transfer students get less aid.

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Since I am going to be quitting my job, I know I can probably fill out some kind of “Special Circumstance” form (or something of the like) to try and have my FAFSA income adjusted to reflect my actual income at time of enrollment.
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It is very likely that all you’ll get is a $11k loan…and that’s it …I don’t think you’ll get some small Pell Grant money. I don’t think the FA office is going to adjust your EFC since you chose to quit your job. In the past, people have reported that they’ve had to show their “lay off” paperwork to get their EFCs adjusted. Choosing to quit your job isn’t going to garner any sympathies. Besides that, when school starts in the fall, you will have already worked 8 months and have all that current year income.

Most likely, this school and your living expenses are going to be about $25k or more per year (depending on your apartment costs, etc). I’m guessing that you’ll be living in an apt. By yourself or with a roommate? If by yourself, then your housing expenses ALONE could be $15k+ per year (rent, electricity, cable, internet, etc).

I think quitting your job is a bad plan. You have managed to do lower division classes while working, you likely can do upper division as well while working. Will your job let you cut back your hours? If not, can you get a job that would pay you about half that much?

Most people WORK while they’re in college. Maybe not full time, but at least part time.

What schools were you considering transferring to? a local state school?

6

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am a bit more familiar with financial aid then I was when I posted this, and have read all about the horror stories of student loans. I do not want to get myself into that kind of situation. Judging from my earning potential, and my want to be, relatively, debt free, it looks like I will be constrained to NJ.


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You want to graduate relatively debt free? If so, then you shouldn’t quit your job, unless there’s another job that you can get near your new school.

I highly doubt that Rutgers is going to adjust your EFC down for junior year. You will likely be expected to pay for nearly all costs.

Keep in mind that COA is likely based on either living in a dorm for 10 months or sharing an apt for 10 months. Your living expenses will be higher since you’re an independent who will likely be living in an apt year round, and maybe by yourself.

What kind of work do you do now? What kind of work can you do part-time during the school year and full time during the summer in order to earn at least $10k per year?