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Financial aid season for college students doesn’t kick off for another five months, but parents should take a close look at their investments and assets now to help maximize their child’s aid eligibility.
The Free Application for Federal Student Aid (FAFSA), which students must fill out in order to apply for federal, state and some school aid, determines the expected family contribution (EFC) – the amount that your family could be responsible to pay out of pocket toward college education. The lower the EFC, the more financial aid a student is likely to receive.
Parents who are considering selling investments, like stocks or mutual funds, or real estate should consider the impact their capital gains or losses will have on their child’s financial aid eligibility. In general, capital gains increase a family’s adjusted gross income (AGI), which tends to decrease their financial aid.
In addition, this year presents a new opportunity for high income-earning investors to roll over their Individual Retirement Account (IRA) into a Roth IRA, which can provide plenty of tax perks but can hurt their request for financial aid.
Investment Moves That Increase Financial Aid - Personal Finance - College Planning - SmartMoney.com
I'm hoping when mine get that age that they decide to run off and join the circus. ;)
When you have only two pennies left in the world, buy a loaf of bread with one, and a rose with the other.