MINT HILL, NC – The pandemic is causing chaos and uncertainty for colleges and students. But still, plans must be made. In fact, the federal financial aid application, or FAFSA, becomes available Oct. 1 for the 2021-22 award year.
But if you have younger children, still years away from college, you may want to take some steps to improve their chances for financial aid.
First, think about saving money in your name, not your child’s. The FAFSA looks at 20 percent of a student’s assets, but less than 6 percent of yours.
Also, be aware that recent contributions to your 401(k) and traditional IRA can be counted on the FAFSA as untaxed income, which may affect financial aid eligibility.
Furthermore, withdrawals from these accounts in the year during which you’re applying for aid, and the prior year, may work against you.
You should consult with a college’s financial aid professional for guidance about your specific situation, as aid calculations can be complex. In any case, learn as much as you can about the process – because the more you know, the better prepared you will be.
If you have any questions, please contact me at 980-859-2549 or by e-mail at firstname.lastname@example.org
This article was written by Edward Jones for use by your local Edward Jones Financial Advisor