1) There is no way we are getting any aid; we earn too much and own an expensive home. We don’t even need to bother with the FAFSA form.

The formulas used to calculate the family’s EFC (Expected Family Contribution) do not include the value of your primary residence. The formulas consider the total number of family members and how many will be attending college at the same time. In addition, to be eligible for low interest government loans, you must file the FAFSA.

2) With all of our expenses, I am sure we will get financial aid.

College financial aid formulas have little to do with your expenses. They are based on income and assets. You will likely have to find other ways to help you pay for college.

3) We don’t have a problem. We have enough set aside in savings.

Using savings, even when available, could be one of the most expensive ways to pay for college. Low cost loans, some of which are tax deductible, could provide more flexibility at a reduced cost.

4) We can’t afford to send our child to a private college anyway. We will get the same amount of financial aid regardless of the college our child attends; we will just apply it to a state school tuition.

The calculation of your EFC is not affected by the school your child attends. Private colleges, however, often have endowments that State schools do not have. After considering the financial aid packages, it may actually cost less to send your child to a private college.

5) We already put our money into our child’s name to save on taxes. We will just have to write the checks.

Certain assets are counted much more heavily in the financial aid formulas than others. The name(s) on the account make all the difference. Knowing which assets should be spent on college costs first can make a difference of thousands of dollars in aid eligibility.

Realities ~

Three out of four families do not have a plan to pay for all four years of college.

College tuition is negotiable, if you know how to do it.