Any college financing/FAFSA experts here? (UVA, school, scholarship, scores)

[GoCUBS1]

Originally Posted by StealthRabbit

GOCUBS! One of my kids will surely fly from left coast to a WS game for a one-day-trip. BTDT many times for him. Kids these days know SO MUCH more about Work-Life-Balance!

Thanks again for your advice and GO CUBS! So happy to finally be able to say that! I'll be at the game tomorrow!

[Qwerty]

Originally Posted by GoCUBS1

Thank you - some great points. We are just beginning to visit colleges and - surprise, surprise - the $70k schools look so much better to the 16 y.o. kid than the $30k in-state schools. He does need to have some skin in the game - that is exactly what we're trying to figure out now. What will be our base $ amount (thinking will be the in-state tuition) and he pays a % after that. We may then take his contribution and invest it for him so he'll have as start-up $ or home down pmt after graduation. The problem is one parent is comfortable footing the entire bill, while another wants kids to work/save/finance most of it. Hopefully, a good compromise will be found.

Just note, those 70K schools often net out less than those 30K state schools. It's good to look at a variety of schools but don't discount on the sticker price alone.

While I agree that having a skin in the game is important, that skin doesn't always have to come from a savings account somewhere. Earning scholarships can be pretty lucrative and schools have a minimum GPA to maintain those scholarships. Also, I think the "party through school" problem is by far the minority vs the majority. You know your kid, if he is a dedicated student with a good head on his shoulders, that has grown up having to have some responsibilities around the house, chances are slim to none that he will go off the deep end in college and be an 8th year senior general studies major.

Our conversations with our kids from a young age was that they had to work to their potential in high school, get good grades, work in the summers, basically build the resume needed to get the big academic scholarships and we would pay the rest. Our kids did that and honestly, pretty much pay nothing outside of personal expenses for school-which come from summer earnings. They ended up getting several different scholarships that pay/paid for tuition and then are/were RA's and other on-campus positions that paid for Room and Board.

Figuring out what you are willing to pay each year is a big benefit to your child. So many people do not do this and when all was said and done, they had a huge eye opening experience when the financial aid numbers rolled around and they couldn't afford the schools their kids applied to (or their kid didn't get accepted anywhere because they over estimated their academic strength).

[kevinm]

Originally Posted by GoCUBS1

At what detail level does FAFSA consider income/assets?

I own a business (C Corp) so would they only consider salary I draw from that business, which I have kept under $100k for 2 years. They would not request any Profit & Loss reports, right? What about profit sharing/401K amounts?

Are additional assets/incomes from investment properties also reported on the FAFSA?

Also, a student's salary is reported, right? So it would not be prudent to put the kids on the payroll, correct?

You do not "own" a C-Corp. You are a shareholder. Your income/assets of that C-Corp are your salary as reported on your W-2 and your K-1 issued at the end of the year.

Retained earnings/profits of the corporation are owned by the corporation and not you personally.

[GoCUBS1]

Originally Posted by kevinm

You do not "own" a C-Corp. You are a shareholder. Your income/assets of that C-Corp are your salary as reported on your W-2 and your K-1 issued at the end of the year.

Retained earnings/profits of the corporation are owned by the corporation and not you personally.

I understand that, so let me rephrase so it is correct:
I am a 51% shareholder (spouse is 49%) and we are the only two board members of a successful, 15 year old, private C-Corp of less than 100 employees. As such, we have flexibility to designate, within reason, our own salaries, many expenses, loans, 401k/match, bonuses, profit sharing distributions, rental of our buildings, salary/benefits of our children (if we employee them), etc.

I came to this board to see if anyone had any tips on how to structure finances for upcoming tuition costs. I have had some good advice via posts and also PM. I will also talk to our accountant and tax attorney about this.

[StealthRabbit]

Originally Posted by GoCUBS1

I understand that, so let me rephrase so it is correct:
I am a 51% shareholder (spouse is 49%) and we are the only two board members ...I will also talk to our accountant and tax attorney about this.

Good idea, and GoCUBS - GO!

I expect you will want to keep a reasonably low 'wage / distribution' near and during Fafsa, but... don't expect ANYTHING from FAFSA, and you won't be disappointed. We did a lot of planning / shifting / allocations, and they might have spent 5 minutes on the application, to just say NO. I suspect the staff / rules do not take kindly to USA white folk who have ANY income or Savings or EQUITY. Likely just the 'rules';

Any assets or earnings?
Above Poverty level?
Not on public support?

= minimum benefit (deferred interest / payments), no subsidized loans, definitely no grants.
"the End !"

"Hand me the next application please"... repeat 1,000 times per shift, go home, repeat 25 yrs, take pension and go home and count your money (daily).

We had friends who spent thousands on College 'financial aid' service companies.

result 10 yrs AFTER college... free market hiring = level playing field for outgoing students... some get lucky, most get average (jobs / school bills / loans). Some elite students got GREAT jobs (all (in my case) were international students and spoke a few languages and performed VERY well on tests / interviews / school / extra curricular )

Best advantage, keep your kids engaged in the community and productive activities. Find their passion and positive reinforce as able. Kids still learn by example. Teach them to choose their friends very wisely. College colleagues / profs / contacts have brought our kids far along the path of growing up independently +/-. Very + in our case (thank goodness).

BOYS seem to benefit MUCH from being busy with their hands / learning skills and crafts. There is a VERY narrow time for that (age 12 - 20). Once they are OUT and ABOUT, the time / interest / diversions seem to water down the commitment. They also get a very 'ACCOMPLISHED' aire about themselves about age 23- 29. (maybe the PERFECT time to become a "U.S. MARINE" YMMV

[ChessieMom]

Originally Posted by StealthRabbit

BE CAREFUL, you cannot legally use the Student loan funds for investment (Note I said "equivalent funds")

My most astute trader kid, went on to get his CFA and work on a team of 24 that managed $80b (for mr and mrs benevolent & wealthy ) Learned a lot and moved on. Both my kids are very active in venture capital / invention / start-ups (which seems to be far more popular than a 'real-job' as you and I knew it.)

and... they have no problem with dropping funds into my acct when I need it (such as taking one yr off and traveling internationally). It all works out in the end, but.... my kids get ZERO inheritance, so little incentive . They will be happy if they don't get DEBT (As I did from my parents).

Where do you live that a child inherits his parents debt?

[Qwerty]

Originally Posted by GoCUBS1

I understand that, so let me rephrase so it is correct:
I am a 51% shareholder (spouse is 49%) and we are the only two board members of a successful, 15 year old, private C-Corp of less than 100 employees. As such, we have flexibility to designate, within reason, our own salaries, many expenses, loans, 401k/match, bonuses, profit sharing distributions, rental of our buildings, salary/benefits of our children (if we employee them), etc.

I came to this board to see if anyone had any tips on how to structure finances for upcoming tuition costs. I have had some good advice via posts and also PM. I will also talk to our accountant and tax attorney about this.

Structure how? The most you are going to get for financial is is unsubsidized federal student loans. If you report a low income and a high value home/assets, they are going to request tax returns. You already verify your income through the online verification process. There are some tax credits out there but your income is likely too high for those as well.

[StealthRabbit]

Originally Posted by ChessieMom

Where do you live that a child inherits his parents debt?

ANYWHERE, if you have embedded the personal value set to care for your family and cover their debt (parents OR child)

Most of my parent's debt was to extended family and good friends, so.... at $2.65 / hr and selling off the few remaining assets, I paid off what I could. (while my peers went off to college).

No FAFSA in my day, yet another burden imposed by 'ill informed politicians' to pursue the transfer of wealth.

I shopped around to find an employer that would pay for my school. (that option is still available today)

[GoCUBS1]

Originally Posted by Qwerty

Structure how? The most you are going to get for financial is is unsubsidized federal student loans. If you report a low income and a high value home/assets, they are going to request tax returns. You already verify your income through the online verification process. There are some tax credits out there but your income is likely too high for those as well.

Structure by reducing income, sheltering taxes, employing (or not employing) kids, company paying tuition reimbursement for kids, etc... Things mentioned in this thread...

My income can be kept very low and my assets are tied up in the corporation. Only schools that request a CSS and/or Profit & Loss Reports would be able to determine business asset value, and even then it may be difficult.

[foodyum]

forget pell, your not even in the ballpark. The schools with institutional aid at a high income level - mostly the Ivys- use css.
I think your best bet is going to be merit. Did you mention what your state is? Some have scholarships for high high school rank.