<p>the efc calculator (at <a href=“http://www.finaid.com%5B/url%5D”>www.finaid.com</a>) said the student is eligible for a unsubsidized Stafford loan. </p>
<p>what is that?</p>
<p>is this the loan that has no interest due until graduation in 4 yrs?</p>
<p>also, I notice that there was a difference in the efc between what fafsa calc’d and this one. The real one calc’d 19846. <a href=“http://www.finaid.com%5B/url%5D”>www.finaid.com</a> calc’d 18203 with the same numbers.</p>
<p>anyone else have this kind of diff?</p>
<p>and</p>
<p>what does efc mean that the fafsa output?</p>
<p>does this mean that we have to come up with $20,000 by September?</p>
<p>No. An unsubsidized Stafford loan the interest is due from day 1 but you can have the payments deferred until after graduation (which adds the interest to the loan balance). </p>
<p>A subsidized Stafford loan is the one that no interest is due until completing/ceasing school. It is subsidized by the Govt who pay the interest till then.</p>
<p>finaid.org has more information about loans here </p>
<p>The EFC is what FAFSA estimates the family is able to contribute toward the education. COA (Cost of Attendance) less EFC = financial need. Financial aid is based on the financial need and may consist of grants (unlikely with an EFC of 19000+), loans, work study and possible a GAP depending on whether the school is one that meets full need. If any of the schools require CSS (mostly private schools) that will be used for institutional aid rather than FAFSA.</p>
<p>I am surprised there is that the finaid calculator was that far off. I had though it was more accurate.</p>
<p>A gap is when the amount of need that is not covered. Many schools do not meet full need. For instance if the schools COA is $25,000 and your EFC is 19846 then the ‘need’ would be $5,164. If you were offered $3,500 in stafford loans and nothing else you would have $1,664 in unmet need. Referred to as a gap.</p>
<p>thanks again. I input a lower parental income, and left all the rest the same, and <a href=“http://www.finaid.com%5B/url%5D”>www.finaid.com</a> said,</p>
<p>… Assets were ignored because you qualify for the simplified needs test.</p>
<ol>
<li><p>I wonder why assets were not ignored when the income was higher? I thought that assets were sheltered up to a certain amount, and our assets are WAY below that threshold for my age (age 49, assets are excluded up to $40k something; we have $15k). </p></li>
<li><p>What is the simplified needs test?</p></li>
</ol>
<p>SImplified needs test - if the parents AGI (adjusted Gross Income) is $49,999 or less and the parents can file a 1040A or 1040EZ then all assets are ignored in the EFC calculation. (there are some other qualifications as well - food stamps etc).</p>
<p>Asset protection is different. It is based on a table that takes into account number of parents and the age of the older parent. For age 49 with 2 parents the protected allowance would be @ $47,900 so if you had $100,000 tin parent assets and did not qualify for simplified need then $52,100 of assets would be used in the EFC formula. If you qualified for simplified needs the assets would be considered in the EFC formula. </p>
<p>In your real life case with $15,000 of assets and not qualifying for simplified needs the formula would look at your assets and apply the exemption to them. The formula would take the protection allowance away from the asset figure and it would be negative so would put $0 for the amount of assets. </p>
<p>If you qualified for simplified needs the formula would not even look at your assets. i.e. It would not go through the process of taking the protection allowance away from the assets - it would just completely ignore the assets. As your assets are $15,000 it would not actually make a difference because they are protected anyway. But if they were $100,000 having them ignored by the formula would make a difference.</p>
<p>The finaid calculator said the assets were ignored because it did not look at them at all. Try running the numbers again with income of $50,001 and $100,000 in assets then with income of $49,999 and $100,000 in assets. You will notice a considerable difference in the EFC.</p>
<p>That is a bit wordy - hope it made sense.</p>
<p>Anyway the reduction in EFC must have been from the reduction in income as, in your case, the assets would not make a difference either way.</p>
<p>thanks, again. You are right about the assets being ignored. I sifted in more assets, bumping to 61,000, and the EFC was still the same. Now, if I only can figure out how to live on 55 pct less income when we could not live on 100 pct, w/o credit cards. Mr Wizarddddd!!</p>
<p>You may not believe it now but when the kids are away at school the household expenses are much lower. Groceries obviously (although it has taken me a while to get used to cooking for two), water, even gas and electric because their rooms are closed off. Check with the insurance people about the car, if they are far enough away, you can get a car insurance discount (because they are using it so much less.)</p>
<p>Technically, no. Most, if not all, schools bill by the semester. So, half of tuition, room & board, fees, will not be due until the billing date for second semester. In our case, that was the first week of January.</p>
<p>However, in practical terms, it is not a good idea to cut it extremely close in terms of your savings. No one wants to tell their kid they have to drop out in the middle of the school year because they couldn’t get the money together during the fall.</p>
<p>Some deposit on the first semester, perhaps significant, might be due during the summer.</p>
<p>thanks for the input. can you put college tuition on a credit card to get points?</p>
<p>I guess tuition is not tax deductible, right?</p>
<p>I learned from the cc thread on the candidates that Ron Paul would make college tuition fully tax deductible, impling that it is not so now. This proposal, along with his rational approach of getting US out of Iraq, which he properly called a misadventure, got this lifelong Dem to vote for him. It took courage and decisiveness, too, to express this point of view within his ranks, qualities that I really have not seen amongst the other candidates. But he, and this rational msg, really is showing up all the time on cnn and in the paper, and in the votes - NOT!</p>
<p>There is the Hope tax credit. It is for students in the 1st two years of school. It is up to $1650. It is a tax credit to actually reduces your taxes by $1650 (100% of the 1st $1100 of qualified expenses - 50% of the next though there is an income phaseout).</p>
<p>There is the Lifetime Learning Credit of up to $2000 per tax return (20% of the 1st $10,000 of qualified expenses). Again it is a tax credit. You cannot claim both Hope and Lifetime learning for the same student in the same tax year</p>
<p>Then there is a tuition and fees deduction of up to $4000. (ie not a tax credit but a deduction - reduction in income) </p>
<p>You basically have to figure out which is the best tax benefit for you to take. And if there are any scholarships or 529 account withdrawals out there they can affect it too as you cannot double dip - that is you cannot use the tuition/fees to reduce the taxability of a scholarship, as a qualified expensed for 529 withdrawals and for tax credits/deductions. Only for one so you have to figure out which is best for you.</p>
<p>joecollegedad, many schools have another payment option. We use a company called Tuition Management Systems. We pay monthly (there is a 10 and a 12 month payment option). Many schools use this company, and I believe there a few similar companies. If I remember correctly, the first payment begins May 1 for fall enrollment on a 12 month plan.</p>