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And the Award Goes to… Our Amazing Clients!

And the Award Goes to… Our Amazing Clients!

Further proof that when you take our advice and follow our system, you get fantastic results…

The College Money Guys is pleased to announce that our final scholarship numbers for our class of 2015 students have just been finalized.  We were able to help last year’s Seniors achieve My man oscarover $10,151,330.00 in free money for college!  That’s an average of over $150,000.00 PER STUDENT for 2015.  This is grant and scholarship money and does not include any loans (which only make college more expensive).

In addition, we are over the Five Million dollar mark for our class of 2016 Seniors and not even half of our 2016 class have reported yet.

Thanks to our students and their families for another record year!

 

 

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Avoid the Use of Trusts for College Funding

Avoid the Use of Trusts for College Funding

I recently had a client approach me with the idea of setting up a trust for their student, hoping that it wouldFinancial Plan disqualify the money from the financial aid formulas.  Thank goodness they asked before moving forward.  The cold reality is, a trust is one of the worst ways to go if you are hoping for financial aid.  Why, you may ask?  Let me tell you…

First, trusts are generally considered a tool of the ultra wealthy used to avoid paying taxes. This is a common misconception, but the operating word here is “common”.  Many financial aid officers will look at an applicant with a trust and mentally stick a silver spoon in the student’s mouth.  Unfair or no, this is going to work against you when you’re competing for grants and scholarships against other students who do not have a trust.

But let’s just say that you have a financial aid officer that understands that not all “trust babies” are wealthy.  You’re still fighting an uphill battle from a financial aid standpoint.

This is because the financial aid office considers the the trust to be an asset, and the money contained therein as available for college expenses.  This is true regardless of the terms set forth in the trust document.  Even if the student can’t access the money until they’re 30, the college is going to consider that money from a financial aid eligibility standpoint.  So let’s look at what that means when we run it through the formula.

If your child is the beneficiary of a trust, whether or not the trust is available, the FAFSA will reduce aid eligibility by 20%. There is no Asset Protection Allowance for the student. This means that for every $10,000 put in a trust for your student your EFC will increase by $2000.00.  Over four years that’s an $8,000 reduction for every ten grand, which works out to 80%. The same goes for UTMA’s, UGMA’s and (sadly) gifts from grandma and grandpa, if done through typical estate planning strategies.

Bottom line, if your child is the beneficiary of a trust, it’s going to hurt come financial aid time.

 

 

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How To Prepare For Your College Freshman Coming Home For The Holidays

How To Prepare For Your College Freshman Coming Home For The Holidays

College, Financial Aid, Christmas Break, family stress

Home for the holidays can be stressful for parents of college students.

Beware of Hidden Landmines

Your college freshman is coming home for the holidays, now what? Having the time to reconnect and visit is very enticing. But this time is filled with lots of hidden landmines. Your child has been on their own with no curfews, no one to report to, enjoying total freedom. The dynamics have changed and whether we as parents want to admit it, so have our children. So, how do you navigate this new twist to your relationship?

Remember the Key Term – Respect

The key term to remember during this time is respect. Once your child has returned and settled in it is time to sit down and discuss the parameters of this new phase of your relationship. By discussing expectations at the beginning of the visit you can set the tone for a very enjoyable break. Keep in mind that the discussion is a two – way talk, your student will also have expectations and requests that need to be heard and honored.

Communication is Highly Important

Prior to the conversation it would be wise to let your child know that you’d like to talk about their time at home and what plans they have. In giving them an opportunity to think about their plans, the discussion will be more productive and they will not feel ambushed. The goal is to tackle this new territory together. Your parenting role has shifted now and getting used to this new role will require you to spend some time determining what you want this new part of the journey to look like. I really encourage you to put thought into this; purposeful parenting should always be your motto!

Don’t leave this visit to chance. Don’t wait until your expectations are not met to talk with your student. Chances are if you do you will be feeling disappointed and angry and this is not a good recipe for building a strong relationship. Together you and your child can determine a level of understanding that will allow both of you to enjoy the holidays and your time together!

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