John E. Jaku-Hing
Guest
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| Posted: Fri Apr 02, 2004 9:11 pm
Post subject: Involved situation concerning grad school... |
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I am attending graduate school for my Ph. D. in Computer Science in
the Fall, and am planning on purchasing a home with my assets from a
previous home sale. The likelihood is that I will pay cash for the
house and forgo the mortgage process (the good ol'
buy-sell-downgrade/own outright cycle). Right now, however, the
assets are sitting in an account earning a "substantial" amount of
interest. Since the idea of buying the home is to shield my assets
from FA, should I wait to file until I purchase the home (around
June-July or so)? Since I sold my old home in Dec 03, I won't really
have earned much interest on the assets on my 1040, but next year it
won't be so easy to explain...
Any suggestions on how best to proceed? Oh, yeah, another unfortunate
fact...I am leaving my job with a borderline 6 figure salary
(pre-exemption: 6 figure, post-exemption: 5 figure) to return to
school. I'm sure I won't make nearly as much working per diem or
part-time for 2004 taxes. I'm not trying to sound elitist (there are
many people who earn more than myself anyway), but just stating my
approx. salary info candidly so I can get some objective advice.
Thanks for any help you could provide.
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Steve Blank
Guest
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| Posted: Sat Apr 03, 2004 12:04 am
Post subject: Re: Involved situation concerning grad school... |
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John E. Jaku-Hing wrote:
| Quote: | I am attending graduate school for my Ph. D. in Computer Science in
the Fall, and am planning on purchasing a home with my assets from a
previous home sale. The likelihood is that I will pay cash for the
house and forgo the mortgage process (the good ol'
buy-sell-downgrade/own outright cycle). Right now, however, the
assets are sitting in an account earning a "substantial" amount of
interest. Since the idea of buying the home is to shield my assets
from FA, should I wait to file until I purchase the home (around
June-July or so)? Since I sold my old home in Dec 03, I won't really
have earned much interest on the assets on my 1040, but next year it
won't be so easy to explain...
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The FAFSA asks you to report your assets as they actually are on the day
you file the FAFSA. The FAFSA ignores equity in your home. If you filed
your FAFSA today with that money in the account, it's a reportable
asset. If you file after you've paid it out for the house, then it's not
a reportable asset.
The interest should not be a problem. It's easily explained if they
bother to ask - you were between houses.
Most graduate students will receive aid only as loans, up to $8,500 in
subsidized Stafford loans if eligible, plus another $10,000 in
unsubsidized Stafford loans. Given your income, and assuming that you
have no other dependents beyond a possible spouse, you will probably
have an Expected Family Contribution of at least $30,000. If so, you may
only be elgible for the unsub Stafford, and in that case the presence or
absence of the house money won't matter anyhow.
--
Steven B. Blank
College Financial Aid Consultants
29 Ives Hill Court
Cheshire, CT 06410
(203)250-7761
| Quote: |
Any suggestions on how best to proceed? Oh, yeah, another unfortunate
fact...I am leaving my job with a borderline 6 figure salary
(pre-exemption: 6 figure, post-exemption: 5 figure) to return to
school. I'm sure I won't make nearly as much working per diem or
part-time for 2004 taxes. I'm not trying to sound elitist (there are
many people who earn more than myself anyway), but just stating my
approx. salary info candidly so I can get some objective advice.
Thanks for any help you could provide. |
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