One of the biggest MYTHS is that students that have parents with high incomes (high incomes referring to parents making $80,000 or $100,000 or more!) cannot receive financial aid.
There are parents all over that do NOT fill out the FAFSA (Free Application for Federal Student Aid) because either 1) they think they won’t qualify for financial aid because they make too much (or have a lot of assets) or 2) they filled out financial aid forms before and only qualified for loans. When high income earners don’t know the “loop holes” that you can use when filling out your financial aid forms, they will only qualify for loans. Can you see why so many people that earn a lot of money think that it would be a waste of time to fill out financial aid forms? I sure can! It’s all because they don’t know the rules to the “FAFSA” game.
So GREAT news for Parents that are 6 figure earners: You CAN qualify for need-based financial aid. One of the ways that you can qualify for financial aid is by choosing a college that uses the Section 568 formula. With the Section 568 formula, you can take all of the money sitting in your bank account and pay down or pay off your mortgage. Doing this will help qualify you for need-based financial aid. Whereas, if you would have kept the money just sitting in your bank account, you most likely will have received $0 in need-based financial aid.
One thing to remember, the financial aid forms are always based on the previous year (just like your taxes) so you have to really think about the right time to do these things. For example, if you take all of the money out of your bank account in the beginning of the year, say January 2013, it will not be taken into consideration for your child’s financial aid award letter for the 2013-2014 school year because the 2013-2014 financial aid award letter is based on your income and assets from 2012.
To find out more ways how you or your child can graduate college debt free and get financial aid, visit: www.debtfreecollegegrad.com
By: Shanice Miller, founder of DebtFreeCollegeGrad.com