Nov
8
The Countdown To 10 Mistakes Made By Parents During The College Planning Process
November 8, 2009 | Leave a Comment
Mistake #6: Not knowing how to differentiate “included assets” and “unincluded assets” for filling out financial aid.
Reality: Certain assets are counted much more heavily in the financial aid formulas than others. For example, savings accounts, CD’s, stocks and bonds are all included and asked about on the Federal Financial Aid form. However, it does not ask about the value of annuities or cash-value life insurance anywhere on that same form.
Mistake #7: Your money would still be counted the same way; no matter where you keep it.
Reality: The real deal is always put into consideration. Where you keep your money is not important and can affect your chance of getting $10,000 for financial aid of nothing. For example, money under a child’s name is important that money is the parent’s name.
If you don’t know how to legally and ethically position your money properly for purposes of financial aid, you could end up losing thousands in financial aid that you otherwise deserve!
Mistake #8: Having a CPA or tax preparer fill out forms for financial aid for you. having them do it for you.
Reality: Unfortunately, CPA’s and tax preparers are experts at tax planning and preparation – not financial aid planning. For example, a CPA or tax preparer might suggest that you put some or all of your assets in your child’s name to save money on taxes. While this advice is well meaning, it will usually kill most or all of your chances of getting financial aid.
CPA’s and tax preparers are not very careful with filling out financial forms. They can sometimes omit some vital information like (i.e., using pen instead of pencil, using correction fluid to cover mistakes, and not including social security numbers, etc.). These mistakes can often lead your financial aid forms to be brought down at the “bottom of the pile”.
If your forms are filled out wrongly, you would need to re-submit them all over again and you will lose a thousands of money, since, the financial aid is a first come, first served basis. However, properly filled out forms will be considered first and will belong to the “top of the pile” consideration.
Mistake #9: Waiting until January or even worse after January of your child’s senior year of high school to start working on your college financial aid planning.
Reality: Your financial aid is based from your previous year’s income and assets, and it’s better for you to start planning as soon as possible before January of your child’s senior year. You can actually maximize your eligibility for financial aid by legally setting up your income and assets. Work on his one year in advance, usually at the beginning of your child’s Junior year in high school.
It’s tougher to set up your financial aid once you wait longer and get closer to your child’s senior year, you create a “red flag” for the college and universities. You can start saving once you know what your “Expected Family Contribution”.
Know which schools give you the best packages and then form there, you can start visiting and applying to them. If you haven’t started planning, My advise is, DO IT NOW!
Mistake #10: Going Through The Financial Aid Process By Yourself Because It’s “Cheaper”.
Reality: If you are most likely to be guilty of these, then colleges and Federal government will have a wonderful day, they will surely love you! here are the reasons why.
This would have them control instead of you the parent, you must understand how it really works and take control of it. It’s always a fact that we constantly go to a doctor when we get sick, go to a lawyer when we get sued, but then I cannot understand it when we wanted to send our child to college, and would readily spend $10,000-$45,000 per year, we wanted to save money and do it ourselves without any help.
I’m going to give you information on how this is. Because of the complicated system that grew, the combination of federal and government bureaucracy, with involvement of private, for-profit and non-profit enterprises, rules deadlines, regulations and other complications. At the end: it’s not easy knowing how to do things.
Unless you spent the last 5 – 10 years of your life studying and understanding the financial aid process, there is no way you are going to know how to get the maximum amount of money from each school. And, if you do try it yourself, you’ll probably spend countless hours trying to figure it out. It can be done, sure. But you might have to quit your day job!
The lesson to this story: ” Don’t Be Penny Wise And Dollar Foolish!” get a service of an expert to help you with the process! Normally, the cost of your investment will return a lot of profit for college aid that never could be obtained as “do-it-yourself!
To find out exactly how I can help you with college financial aid, check out my website on Illinois college tips and get a FREE Report: “How to Pay For College Without Going Broke”
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