<p>is it true that if you have any money in the bank that is under your name like a savings, or a trust account, that the colleges see to that and expect you to use that money for tuition, therefore not giving u as much ???
do i have to take that money out or something//??? i hear many of my friends who have taken money out of their bank accounts in order to receive more aid.</p>
<p>You have to declare your assets as a student and also those of your parents. FinAid depts usually think students should use about 35% of their assets.</p>
<p>The largest component of financial aid seems to be based on income, if your income is below certain levels, some assets are protected. It is silly for some one with a 6 figure income to be illegally hiding assets.</p>
<p>If you take money out of your savings/trust account, you would still, legally, need to declare it as an asset, unless you spent it on something.</p>
<p>Your parents would be better off to pay down their mortgage (for a UC) than have the money in savings; however, if their income is above the limits for aid, then they may need that money to pay the EFC. </p>
<p>Also, UCs do assign a large portion of your aid as loans, even if you have $0 EFC at UCs, you would have about half of your package in loans, it’s not a free ride, you have to be willing to pay up now or later.</p>
<p>It is perfectly legal and ethical to take cash out of savings and pay off a car loan or some other asset maneuvering, but you’d best make sure you have the liquidity you need to pay your share of the cost of education. </p>
<p>It is not okay to take $50,000 out of a trust and hide it under a mattress. You could take $1500 out and buy a new computer.</p>
<p>So, you may have heard people talk about taking money out, but is does not necessarily mean they are hiding it, they may have actual expenses they can justify paying before filing FAFSA.</p>
<p>Somemom’s right on. Clarifying two points:</p>
<p>Re: “FinAid depts usually think students should use about 35% of their assets.” The FAFSA formula takes 35% of the student’s stated liquid assets, and applies 35% of it toward the EFC <b>each year</b>. And unlike parent’s assets, where there is an asset protection allowance, students don’t have any asset allowance.</p>
<p>So you’d essentially spend down any liquid assets in your name over the four years of college (the math looks odd at first, but it works out about right). Unless you spend it before filling out the FAFSA.</p>
<p>So-- $30,000 in an account in the student’s name can reduce your aid package (assuming you’re otherwise eligible for aid) by about $10,500 the first year. If that money were in the parent’s name, it might fall under the asset protection allowance, but even if it didn’t, it would only reduce the aid package by at most $1,800 (they ‘take’ a smaller % of parent’s assets-- under the reasoning that parents have more things they are responsible for).</p>
<p>But-- if you’re considering buying a car-- do it before filling out the FAFSA. A $30,000 car won’t be included in the asset calculations. Ditto a new computer, or any other things you might need.</p>
<p>thank you, i hear that in the state of california the cal states and ucs do take in account that they count up to 10% of the parent’s income and 100% of the students assets such as savings/trust , so im thinking about moving the money to my brothers account for awhile, also i have a few hundred in my checking account, do they count that too? it would suck for them to take all my money away from my debit card</p>
<p>Based on what I have seen, they do count all your money. You’re not supposed to move your money to your brother’s account, that’s not an athical thing to do- you can pay off your car, buy a computer, pay off your credit card bills, pay for every single thing you would need to any way BEFORE rather than AFTER you file the FAFSA</p>
<p>Right-- not cool to hide assets. OK to spend them, though.</p>
<p>And don’t confuse assets with income:</p>
<p>"ucs do take in account that they count up to 10% of the parent’s income and 100% of the students assets…:</p>
<p>You’re confusing assets and income. They’re different, and the FAFSA formula considers both income and assets for both student and parent(s). There’s no 10% calculation of parent’s income involved in the formula.</p>
<p>UCs use FAFSA which means that the EFC will be about 1/3 of your parents gross income that they file on their taxes. Most UCs cost about 21-22K to attend, go to the financial aid web site for the college and check the student budget to see the total cost. So if your parents gross income is over about 70K, the EFC will be higher than the cost of going to school and so you will get nothing.</p>
<p>Check what your EFC is first, if it is higher than the cost of school, there is no point in doing anything with your assets since youre not going to get any money no matter what.</p>
<p>It’s not nearly as simple as saying that the EFC will be about 1/3 of gross income. It could be much higher-- and it could be much lower. It could be 0 for some low income families.</p>
<p>The parental income component (and remember that’s just one of four components) includes an income protection allowance-- which might be between 20K and 30K for most families. That gets deducted from the Gross Income-- as do some other allowances (self employment health insurance, for example). After deducting the allowances, the parental contribution from income will be between 22% and 47% of the available income remaining. </p>
<p>But Timcob is right about checking the EFC-- use one of the calculators. If your EFC is at or around the 22K that most UC’s cost, you’ll likely not get any aid if you use those numbers. If, however, you have a significant amount of liquid assets in the student’s name, you can increase your chances of aid by legally spending down those assets prior to completing the FAFSA.</p>
<p><a href=“http://ifap.ed.gov/efcinformation/0506EFCFormulaGuide.html[/url]”>http://ifap.ed.gov/efcinformation/0506EFCFormulaGuide.html</a></p>
<p>Here is the formula for the 05/06 year, you can see if it spending down will make a difference.</p>
<p>It was be sad to pay down assets and then find out that your income was too high for aid and wish you had the liquidity back!</p>
<p>I think the biggest difference is for people whose income or assets might be right on the borderline- $100 more and you don’t qualify for Cal grant, or something like that.</p>