In California there is now a law that we either fill the Fafsa or fill a a waiver form. What the school counselor has said is that the FAFSA is used for more than need based AID. example work study program or some research funding and so on.
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No youâre not. Very few (5 or 6 I think) schools require FAFSA for non need based merit aid, so unless youâre applying to one of those schools (or plan to take a federal loan) you donât need to fill out FAFSA or CSS.
We didnât, and did just fine with merit scholarships.
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Anyone in this group could successfully submit FAFASA. Our âStart a new applicationâ button is disabled after we login to the portal.
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Yes I was finally able to yesterday for S24. It required him being present to fill his part out and sign off.
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Has anyone else considered the new 529/Roth changes for this year and thought about changing their 529 contribution or withdrawal strategy because of it? Being able to convert up to $35K to your kidâs retirement in a Roth is a pretty valuable use of any âleftoverâ money.
We have a situation with D24 where her graduate school might (or might not) be funded. Realistically, our plan was to more or less cover room and board out of current income because thatâs basically the same amount we pay for private school tuition, but now that she has received significant scholarships, we may just take out the max based on COA and then set it aside for future education, and then evaluate how much we leave in the 529 for grad school/retirement. It certainly makes me glad I set up a separate account for each kid when they were born, and not relied on just changing the beneficiary, since it has to have been in the beneficiaries name for 15 years.
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So my (tentative) analysis is as follows.
As I understand it, any rollover amount would be subject to the childâs annual contribution limit, and would be reduced by any normal contributions the child makes. So unless I am missing something, it doesnât actually increase the amount the child can contribute to a Roth, it just provides an alternative source of funding. But as a parent, you could still, say, give your child cash savings to make the contributions instead, if they did not have enough of their own savings.
Assuming that is all correct, I think the preferred withdrawal strategy is still to either use the 529 funds for qualified expenses (saving money out of other funds that could then be used to contribute to the Roth), or perhaps to save them for the future for possible grandchildren and such (including some private K-12 now, if so desired).
But converting some to a Roth might make sense if the family collectively had no other way to make a contribution up to the limit for the child in a certain year.
In terms of contributions, I have always believed the parents should first make sure they are making full use of their own tax-protected retirement limits. But if they do that, I have never been particularly concerned about âoverfundingâ 529s versus that money ending up in, say, a taxable account instead. So personally, I donât think giving up to the annual gift limit is a problem, even if that ends up being more than is immediately needed.
And again the way I see it, if those funds are being given to the child one way or another, then it usually wonât be bad idea to leave them in a 529 instead of converting them to a Roth. So to me this has not really made a big change in my contribution logic, although more options are always nice.
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Yes, I was assuming that there would be a number of years the kid might not be able to make Roth IRA contribution because it would make more sense to contribute to a 401K with a match. I never did, because we were maxing out Roth 401Ks, and were ineligible for Roth IRAs anyway.
Our 529s are well funded. I have contributed out of my bonus every year since the kids were born. Enough to fully cover undergrad plus a masters. I generally gave D24 a budget of $50K after merit. I also realize that the chances that my kids will have the standard of living as adults on their own that they have now is not high, so I want to set them up for success as much as possible. For example, D made a few thousand at her first job last summer. I let her keep her earnings and she uses a small amount on personal expenses like going to the boba place with her friends. I also contributed the amount of her income to a minor ROTH IRA for her. Time is her most valuable asset.
Right now, since sheâs probably going to a school that will only cost about $4K in tuition, plus room and board, my plan is to take out the max every year and put it in a separate brokerage account in my name (since our obligations would be in the ballpark of what we are paying now). Separate account is only for my ease in segregating it from the rest of our taxable investments. Then we will put it aside for her PsyD (if she doesnât get into a funded PhD program), and if she does get it funded, then we would gift it out to her over time as she starts out on her own. Yes I know money is fungible, this is just how I have it worked out in my brain.
I think that the Roth conversion option may just mean that we would perhaps leave like $25K in there and convert it a bit at a time when sheâs in grad school.
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Yep. We also learned that if kid receives merit the parents can take out the equivalent amount without penalty. (Still need to talk to tax guy, but it sounds like itâs taxable income but no withdrawal penalties).
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My understanding is the earnings portion would be taxable, the original contribution portion is not, and nothing is subject to a penalty (when matching a grant, which can be need- or merit-based, or military academy attendance).
That being said, if you do not actually need the money it might be a good idea to just let it stay in place indefinitely.
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I went in to continue my sonâs FAFSA app today (after getting kicked out on 12/31). I answered a few questions, and all of a sudden it said I just had to review and sign. However, it never asked me to import our tax return or even report anything about our income. Does this sound wrong? (Note: My son hasnât completed his section yet.) I got an email from the Dept. of Ed confirming that my parent section is complete ??? Of course, their online chat has no agents available, so Iâm hoping someone here can share their experience. Thanks in advance!
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OK, so supposedly S24 is submitting three applications today. Two are pretty much done, but one still seems rather in progress (a rather notoriously arduous one). I thought the plan was to submit with the College Counseling staff, but apparently now maybe the plan is to submit after getting home from winter sport practice . . . oh, and two more are supposed to be submitted tomorrow, and those seem quite far from complete.
So, you know, about what I expected.
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Delete
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I briefly joined the parent FB group for my D20âs school. Too much drama, helicopter parenting, petty complaining and entitled assholery for me. Iâm not going to bother for my D24âs school.
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My kid is deep into âcan I use that essay from the other place for this place, too?â 
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Another reason to fill out the CSS Profile is the âspecial circumstancesâ free-text box, where you can explain anything you want. That may not be of use to many, but it is where you can add things like âMy child has already received the x community scholarship.â (Rotary, Moose Lodge, etc.) For a college that is not completely need-blind in admissions, it could give your student a bit of a bump if the college knows they are bringing some merit aid with them.
My student was able to create his FAFSA ID account.
However, as I posted in this already in the FAFSA thread, the page kept freezing for me, so I kept mailing address blank and only entered mobile phone to proceed to create FAFSA ID account as parent. At the time I couldnât add the mailing address at verification/confirmation as it would freeze again.
Once I got the ID, I logged into the account and was able to add my mailing address.
My Activity page was in an eternal loop of loading so it wasnât until overnight and now that my S24âs FAFSA invite showed up for me to complete.
Donât forget this year you can also move over (I believe with no tax hit) $6500 per year to a Roth IRA - up to $35K per kid. SinceâŠyesterday
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Same here, sat on hold for an hour and when I finally did get through I was told that that it could be due to some kinks and that is why site down again.
For us, there was a screen which basically was a click through that basically said âI consent to downloading your tax info.â I believe they already have the ssn from the profile creation. There is no confirmation it did, nor a way to see âthese are the numbers we pulled in.â
There were two screens with three boxes for savings amount / net worth and then one for âalternateâ income (eic, farm, etc).
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Thank you! So itâs normal then to not be able to see the income/financials it pulled in?
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