FAFSA counts 529s as [parents’] assets even if student owned. However , individual colleges, PROFILE schools may not for their own money. They can make pretty much whatever stipulations they please with their money.
In fact, a number of schools have the stipulation in their financial aid acceptance contracts that ANY funds coming into the household mid year like an inheritance must be reported to the FA office. The timing of the receipt of the inheritance should be managed carefully if OP’s son is in a school with such stipulations.
Carefully managed, the impact of the inheritance can be far less on financial aid, and stretch further. There can be a lot of expenses after college to a student that make it difficult to financially balance one’s life , if parents are not in the position to help.
My son took a decent but not particularly high paying job far from home. Getting him set up for this first foray into a career was not inexpensive. It would have been near impossible for a new grad without a bit of a nest egg and/or help from family to have done this.
Going for a professional masters or other degrees or certificates to further one’s career prospects is not easily funded with financial aid as it is as an undergraduate. My nephew is going to law school and it’s all loans and parental assistance which he is privileged enough to have. Such prospects can be the financial ruin for young people who borrow it all, and the investment doesn’t pay off.
$100k if managed carefully can make a huge difference in a person’s life. Or it can disappear in little time, if college costs are in the picture. It’s frightening to me that it doesn’t even cover 2 years at some of our private universities. It is smart investing, management to make it go as far as it can.