Using MEC to shelter assets, pay for college

gidianmellk
Tue, 20 Jul 2021 18:44:49 +0000

Hi.
We’ve been talking to a college financial advisor who turns out to be an insurance agent, which I’ve learned is not unusual. He has recommended a cash-out refi, which I think is good advice, as interest rates are much lower than for private loans. But he has also recommended putting the money in a modified endowment contract (MEC) which is a life insurance contract. I’m skeptical. Has anyone done this? (It would not be reportable for FAFSA, but might be on the CSS…)