Parents frequently assume that their assets will wreck their chances for financial aid. Fortunately, parental fears about their investments are usually worse than reality. You can become a hero to your clients if you can explain the real story behind the role that assets play in their financial aid determinations.
People also ask
How does parent income affect financial aid?
These include being at least 24 years old, being married, providing the majority of financial support a child or other dependent, pursing a graduate degree or having no parents. Parent income does not affect financial aid at all for independent students. Which Parent?
How are student and parent assets assessed for financial aid?
Here鈥檚 a basic breakdown of how student and parent assets are assessed and how they affect your financial aid package. Colleges expect that up to 20% of the assets owned by a dependent student will be used toward college expenses.
How do financial assets affect financial aid eligibility?
As you can see, in general, the student鈥檚 financial assets have a far greater impact on financial aid eligibility as compared to the parent鈥檚 financial assets.
Why do parents transfer assets to their child?
Because assets that belong to the student have a higher impact on financial aid eligibility (a student鈥檚 asset will increase the EFC by 20 percent of the asset鈥檚 value, as opposed to 5.64 percent of a parent鈥檚 asset), some families transfer assets owned by a child to a parent.