University grant aid eligibility ?

Paying for College
1

Folks,

I along with my family are all USA citizens. We have been living in India for the last 10 years. But my business is based in California and I travel back and forth to USA every couple of months. So I have been filing California state and federal taxes for the last 10 years. My net average income for the last 10 years is around $50,000 which is reflected in my tax returns. Since we live in India, the cost of living is substantially less and so even $50k income is considered quite high here. Both my kids will go to USA for their undergrad studies after finishing 12th grade in India. My questions are:

  1. Based on my income, are my kids eligible for University grant aid ? There are Universities where 100% of freshmen receive grant aid. One example is Marquette University. Although the tuition per year is $37,000, 100% of freshmen receive an average of $16,000 in grant aid. I got this information from www.startclass.com

So based on these kind of findings, should I target Universities where the % of freshmen receiving grant aid is high ? Does grant aid depend on income ? In that case, based on my income do I fall in the category where I have a good chance of getting grant aid from the University ?

Thanks a lot.

2

You might get grant aid from a private school. The average amount of aid really doesn’t tell you what your aid would be. But with relatively low income you might get a good amount. It might not be affordable though.

Try a net price calculator on the college website or contact the college to see how much aid they would offer for $50,000 income.

I am not sure if you can get Calgrant if you don’t graduate from CA high school though.

3

Private schools will base aid on income and assets, and possibly home equity.

4

If you are asking if your children will be considered California residents, then no so they are not eligible for CA state funds such as Cal grants and Blue and Gold scholarship but eligible for federal funds at CA Publics. They would also be considered out of state for tuition purposes at UC’s and Cal states. Private school do not care about state residency.

http://ucop.edu/residency/residency-requirements.html

http://ucop.edu/residency/establishing-residency.html

5

Thanks folks for your replies.

Since my business is based in California, I also have the option of moving to California one year prior to my son starting University. I have read on UC sites that either parent’s residency is enough for the child to be eligible for in-state tuition in California Universities. To meet this requirement one parent should be physically living in California for 365 days prior to the term starting. House ownership is not required so leasing is also fine which I plan to do.

Although not easy, is this worth doing since the savings are substantial ? Since California has a whole spectrum of Universities from top ranked to mid ranked, I am assuming my kid will get in at least a mid ranked one.

The other option is to apply to Universities where the child qualifies for in-state after the 1st year. Utah State University is an example. You pay OOS for the 1st year. Then the child qualifies for in-state provided he get the driver’s license, voter registration etc.

Thanks.

6

I am not sure but I thought for someone to be considered domiciled in CA, they have to give up all ties to their former state. I would think that would also apply to your home in India.

And how far is that $50,000 income going to go with living in CA and also supporting family in India?

And how are you going to pay the instate cost of a UC, around $30k, without any aid except a partial Pell grant and a $5,500 student loan?

7

^If you read all information and fine print in gumbymoms links, you will see that your son will also have to live in CA with you for at least a year and that physical presence is not all that is required, but also intent.

8

With your family income it might be better to focus on schools that meet 100% of need, or those that have automatic merit for certain stats.

9

You and your kiddo need to move to CA TWO years prior to his college years to establish a domicile in CA. Not one year…TWO years. Your KID also needs to reside in CA if you want CA residency. And as noted…your family has to cut ties with any other domicile.

You say your income is only $50,000 a year. Can you support two households on that income? It’s very expensive to live in CA.

Also, it will be VERY clear to the CA public universities that your kid isn’t a CA resident when his HS records come from a school in INDIA.

You used Marquette $37,000 a year TUITION in your example. Please add in the costs of fees, room, and board. The cost of attendance for Marquette THIS year is close to $52,000 a year…not $37,000. So…a $16,000 grant would leave you paying $36,000 a year.

Marquette University is a PRIVATE university…and your place of residency doesn’t matter one bit.

I will say…as a business owner, you should be VERY questioning of the net price calculator results. There are a LOT of deductions allowed by the IRS for tax purposes that are added back in as income for financial aid purposes. You may find that your college calculated family contribution is MUCH higher…because of your business.

Also, remember to add back in ALL contributions to tax deferred retirement accounts you make in the tax year used for,the FAFSA and Profile…because the colleges will most definitely count those as income for the year.

What is your GROSS income? Not your $50,000 net…and what is the value of your business?

I have a funny feeling you are WAYYYY underestimating your probable annual college costs.

Your kiddos need to get great grades, and great SAT or ACT scores…and hope,for merit aid. This is not income dependent.

You also need to define the amount you think you WILL be able to pay annually for college.

10

Adding…if your income is $50,000 AND you plan to have twomresidences…one in India and one in CA…I don’t think you will have enough LEFT to pay for college.

Also, do you own your home in India? If so…and you don’t sell it…and move back here…that home will be viewed as an asset for financial aid calculation purposes.

11

From the link in post number 6 it looks like your child must also live with you in California

12

Folks,

We used to live in California for 10 years before moving back to India. During that time I had saved a kitty of $200k for both my kids’ education. So I am able to shell out $100k per kid for their undergrad even if they do not get any kind of aid. Thus any kind of grant/aid/loan I get will be helpful since the total cost most likely will go above $100k per child.

Is taking a private student loan a good option ? If required I can cash out some of my other assets also like stocks but I would rather go for a student loan.

Are there good universities in USA not just California where the OOS tuition will be around $100k for 4 years ?

Both my kids will probably go some branch in Engineering.

Thanks.

13

Reply I received from UC Santa Cruz. It clearly states that only the parent needs to stay in CA to establish residency and that too only for a year.

===================================================================================

Hello,

Based on the information you provided, your son will apply as an international student for purposes of admission.

As for tuition purposes, your son may qualify for one of two exceptions to non-resident tuition. The first applies to minors (studetns under the age of 18), and the second applies to students who are age 18 or older.

We will evaluate your residence status to see if your circumstances meet the requirements for in-state tuiton. These requirements are published on the Office of the President website; pay close attention to the summary of requirements for undergraduates:

http://www.ucop.edu/residency/

If you son moves into your California home prior to his 18th birthday, he would assume your residence status. Rules pertaining to minors are published on page 22 of the UC Residence Policy and Guidelines:

http://www.ucop.edu/general-counsel/_files/ed-affairs/uc-residence-policy.pdf

If your son is age 18 when he arrives in California, he may qualify for the Condit State Law exception - this law permits a non-resident student to be charged in-state tuition if the California parents meets the in-state requirements. The student must then meet the requirements themselves by the following fall.

Documentation is collected from the parent to verify that they have been living, working, driving, voting, and paying California income taxes at least one year prior to the first day of class of the term that the student is admitted.

I recommend that you call me to discuss your situation in detail, if you wiish. I will be here until around 2 pm tomorrow. Our office will re-open on January 3rd.

PLEASE BE ADVISED: Any residency information provided above is a summary of the UC Residence Policy and may not cover all your residence questions or actual circumstances.
An official determination of a new student’s residence status is made only after a student is accepted into UCSC and he or she has submitted a Statement of Legal Residence. No prospective determinations of residence status are made. Changes may be made to the Residence Policy between the date of this statement and the relevant residence determination date.
NO OTHER UNIVERSITY OF CALIFORNIA PERSONNEL ARE AUTHORIZED TO PROVIDE INFORMATION REGARDING RESIDENCE REQUIREMENTS.
The Federal Family Educational Rights & Privacy Act prohibits me from divulging details of a student’s record over the telephone, via e-mail or by fax, or with anyone other than the student.

Joanne Madril
Veterans, Residency & Registration Adviser

Office of the Registrar
UC Santa Cruz
190 Hahn Student Services
831.459.2910

14

No, it does not clearly state that. She repeatedly says “may”. Because she cannot make that determination. It will be made after student is admitted and commits to the school. Which is a bit late and could be a costly mistake if you are proven wrong

15

http://talk.collegeconfidential.com/financial-aid-scholarships/1678964-links-to-popular-threads-on-scholarships-and-lower-cost-colleges.html#latest

to answer your question, yes there are schools where you can attend for $25,000 a year. Or less, with merit.
The above link provides some good info to start, but check college websites for current info.

16

Good point. Yes, it is quite risky.

In that case, it is better to look at schools like in Utah where the child is eligible for in-state after the 1st year. You pay OOS only for the 1st year. I think even NCSU (Research Triangle Park) has this policy.

17

Look at the SUNY colleges. Their OOS costs are in the $35,000 a year range. Your contribution of $25,000 a year plus the $5500 federal loan puts you close.

Honestly, I think you are being VERY optimistic in terms of getting instate status in CA. VERY.

Also, your son’s application will be reviewed with the international candidates from India…who typically are VERY VERY strong. VERY. So there is no guarantee he will,even gain acceptance.

If his stats are strong…would you consider University of Alabama? With strong GPA and SAT or ACT score…and engineering as a major, your costs would be well below $25,000 a year. They have a well regarded engineering program. @mom2collegekids any additional info to add?

18

http://talk.collegeconfidential.com/financial-aid-scholarships/1473219-research-universities-with-lowest-oos-tuition-p1.html

19

thumper1, mommdc,

Thanks a lot for the info.

I am being very straightforward here when I say I have a concern about sending my kids to states like Texas, Mississippi, Alabama.

I may be completely wrong. Maybe the atmosphere in universities like Univ of Alabama etc. is still welcoming to everyone.

20

Yes, you are completely wrong.