In terms of the financial aid from the internationally need-blind schools (HYP etc.), what happens if your parent has little/no income but has had a large amount of money bequeathed to them?
They can’t use up the money from the will to pay college tuition fees, because then the family won’t be able to stay afloat.
But will the schools refrain from giving financial aid because it seems like the family is well-off?
Or is this contextual information which is conveyed to colleges when filling out the forms?
Not sure I understand your “large amount of money bequeathed to them”.
If the money is a bequest which hasn’t transferred yet (the owner of the assets is still alive; the owner is dead but the will is in probate or no assets have been distributed yet) there is no impact of these assets on financial aid because the parent in question doesn’t actually own the money.
Is this your question? Or does the person currently have the funds in an investment account somewhere?
Please clarify. Assets that show up in a savings account are treated as assets regardless of the source. Future assets (a bequest, someone who will be the recipient of a life insurance policy some day but the person is still alive, etc.) don’t show up anywhere.
Funds in an investment account, that is. I now understand from Yale’s asterisked paragraph:-
“Due to either extraordinary assets or university policies related to the calculation of incomes earned in currencies other than US dollars, an additional 154 families who had estimated incomes below $65,000 did not qualify for a $0 parental contribution. These families’ unique circumstances resulted in significantly varied parental contributions.”
Something which worries me is home equity, as the London housing market is ridiculous. When my mother bought the house thirty odd years ago it was the equivalent of approx $110,000 - now it’d sell for over $1.5 million. But the fact remains that my mother has mother has no salary coming in, just the assets mentioned earlier in this thread. How much will the rise in house prices impact upon EFC?
Many colleges limit the amount of equity in the primary residence that they consider in their calculations to 1.2 - 2.4 times of Adjusted Gross Income. So if the income is small the whole $1.5M will not be considered. You can try to verify this with NPC.
How will your mom keep and maintain a $1.5M home? Won’t she need to sell it? Won’t there be property taxes? I have no idea what/if there are London property taxes like here in the US, but if anything similar, your mom would have to pay thousands of dollars in property taxes alone.
Also…will your mom be subject to inheritance taxes? If so, she may have to sell to pay those.
low income people usually can’t keep expensive homes due to the taxes, etc, that go along with those homes.