If your family has accumulated wealth and investments, your EFC can be high, even if your family’s income is low. Parents that withdraw from their 401k to pay for a student’s education are in fact increasing their EFC, because that withdrawal is counted as untaxed income on the FAFSA.

What has the biggest impact on whether a 4 year university is affordable? The amount of financial aid that the university offers.

Scholarships and grants, which covered 31% of cost, and parent income and savings, which covered 30%, are the top two sources of funding. The share of cost paid from other resources are 14% from student borrowing, 13% from student income and savings, 10% from parent borrowing, and 2% from friends and family.

For any amount above your income protection allowance, roughly every $10,000 in extra income lowers your financial aid qualification by another $3,000. Once the income is above $100K roughly 1/5th to 1/4th of income will be counted towards your EFC.

$6,495

Answer: I’m pretty sure to get the absolute maximum amount the EFC has to be 0 or really close to it. The EFC, or Expected Family Contribution, is mainly determined by your family’s income. If your family has multiple students who will be enrolled in college, the number may be lower.

You lose the money. If you received student financial aid because of lying on the FAFSA, you must return it. The Inspector General at the Department of Education will be alerted to your fraud after a school audits your FAFSA.

A nominal value of $200 or $300 may be listed, but the reality is that there is no good reason to include anymore cash assets than that because no one else in their right mind does. Cash assets sink financial aid eligibility, but are virtually untraceable unless admitted to on the FAFSA.

Can I Skip FAFSA Questions about Assets? You can only skip FAFSA questions about assets if you meet the qualifications to do so based on your answers to other questions on the application. However, that’s only because your asset information at that point doesn’t affect your eligibility for federal student aid.

Assets must be reported on the FAFSA as of the date the FAFSA is filed. In practical terms, this usually requires reporting the net worth of the asset as of the most recent bank and brokerage account statements.

The short answer to that question is yes. Savings account balances will impact your financial aid. And it does affect a student’s expected family contribution (EFC) calculations when they complete their free application for federal student aid (FAFSA).

Which Assets Are Reportable on the FAFSA?

• Cash.
• Bank and brokerage accounts.
• Certificates of deposit (CDs)
• Money market accounts.
• Mutual funds.
• Stocks.
• Bonds.
• Stock options.

These qualified retirement accounts, whether owned by you or by your child, are not counted at all in determining EFC for purposes of federal financial aid. Be careful, however, about taking money out of your IRA (or any retirement account) to pay for college.

Information the CSS Profile Asks For Prospective student who would like to apply for a CSS Profile should have their most recent W-2 forms, tax returns, untaxed income records, small-business information, mortgage statements, and current bank statements.

Thankfully, there are smart, law-abiding strategies to keep your EFC low and accurate.

1. Maximize Household Size. The larger your household size is, the lower your EFC will be (in most cases).
2. Increase College Attendance Among Family Members.
3. Wait Until the FAFSA Considers You Independent.

In most cases, your 529 plan will have a minimal effect on the amount of aid you receive and will end up helping you more than hurting you. There are also several steps you can take to increase your child’s eligibility for student financial aid.

There is no income cut-off to qualify for federal student aid. Many factors—such as the size of your family and your year in school—are taken into account.

The student income allowance is $6,660 for 2019-2020. Plus, after that, only “50 percent of your non-work-study income will count against your eligibility to receive federal student funding.”

If you weren’t able to get enough in federal aid, and your parents aren’t able to take out a loan on your behalf or cover the balance of your tuition, you may be able to borrow additional loans from a private lender. You can start learning what private student loans are available by inquiring with a variety of lenders.

Students who are dependent for federal student aid purposes must supply parent information on the Free Application for Federal Student Aid (FAFSA). Students who are independent do not have to supply their parents’ information and often qualify for more student financial aid as a result.

If your student is required to file their own return, you can still claim them as a dependent, but you won’t be able to claim their income on your return. This should not affect what you can and can’t claim for college expenses.

The amount of money you can get by filing the Free Application for Federal Student Aid (FAFSA) depends on your financial need. But, the maximum amount can be in the low tens of thousands of dollars per year. Average amounts are about $9,000, with less than half of that in the form of grants.