Are you still filling out the FAFSA? Is that because you have questions about it? One of the most frequently-asked questions about filling out the FAFSA is, “Do I need to include 529 Plan assets as an asset, and is the answer different if the account beneficiary is a child other than the one on whose behalf I’m filling out the FAFSA?” The answer is Yes and Yes, but there’s a qualifier.
First, 529 plans are parental assets, not student assets. That means that you report the value of all of 529 plan accounts for which you’re the owner, regardless of the beneficiary. What’s the qualifier? The FAFSA gives you an asset protection allowance. If the total balance of your non-retirement assets (checking, savings, 529 plans, brokerage accounts) is less than the asset protection allowance, then although you report them, none of the funds is considered an available asset. (The asset protection allowance is determined by the age of the older parent and whether one or two parents are filling out the FAFSA. For a two-parent household the asset protection is around $30,000; for a one-parent household it’s about a quarter of the two-parent amount.)