Although the government provides many different forms of financial aid for college students, they also expect the student and the parents to contribute a monetary sum. This is called the Expected Financial Contribution (EFC).
Computing your EFC is easy enough to do, especially if you are working with a respected college funding solutions provider like John McDonough’s The Studemont Group College Funding Solutions, LLC. The problem lies in the result of your EFC, as there are times when the amount that comes up is far more than what you were expecting.
Fortunately, there are many effective solutions for college funding you can do to help lower your EFC and increase the amount of financial aid you and your child receive. If you have a child who will start his or her tertiary education soon, be sure to keep the following tips in mind:
Time Your FAFSA Application Right
When applying for FAFSA, be smart about when you actually submit it. The information you jot down on the form has to be accurate as of the day you accomplish it. Before you fill out the form, you should have a good grasp of your financial situation. If you know you will be given a hefty salary increase, you’ll want to accomplish the FAFSA before you receive your bonus.
Place Assets under Your Name
It may seem unfair, but the government actually expects your child to be pay the highest percentage of income and assets, set at 20 percent. On the other hand, the rate parents have to deal with will never exceed 5.64 percent. This means you’ll want to transfer any assets that bear your child’s name to your name for the time being. This includes any college funds you have tucked away in banks.
Be Honest at All Times
It’s tempting to “accidentally” skew the numbers when filling out the FAFSA form, but resist it with everything you’ve got. The federal government treats this very seriously. If you are found guilty of willfully falsifying the information you place in the FAFSA application, you can face an exorbitant fine, and risk your child being denied any form of financial aid from the government. There is also the risk of going to a federal jail for up to five years. Simply put, lying isn’t worth whatever benefits you think you may get.
Reduce contribution, increase aid, Bank Rate
How to Reduce Your Expected Family Contribution, College.LoveToKnow.com