FAFSA does have a minimal income protection allowance. For parents, it tracks the federal poverty line fairly closely but has an additional variable of number attending college. For students, it’s a flat $6,420. Here is the table from this year’s FAFSA for dependent students:
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FAFSA
There are four components of EFC: parent income and assets, and student income and assets. Each is assessed slightly differently in the formulas. Since parents generally have substantially more income and assets than students, their portion of the EFC gets considerably more attention. Let’s look at the student side because it can cause
Generally you need to add your retirement plan contributions back into your income for FAFSA purposes. There is an exception for mandatory contributions such as in many public sector retirement plans. That’s because those are not discretionary, unlike
The FAFSA’s asset protection allowance is pretty low– about $19,000 for married parents or $11,000 for single parents, and zero for students. (See page 19 here for exact amounts.) What goes in that? For most people, the biggest ones are any non-retirement savings accounts including 529 plan accounts, the balance in your checking account and the net
Get ready for a wild Saturday: Oct. 1 is when the 2017-2018 FAFSA will be available. This year it should be considerably easier to complete. Why? Because if you’re eligible– and most people are– you won’t need to manually enter your income data. Instead, you can just link directly to your 2015 tax return via the IRS Data Retrieval Tool…