Continuing from our blog last week from a Wall Street Journal article:
Step 3: Manage Your Expenses Effectively
Families planning to soon pay for large purchases (new car, replacing appliances), home improvements (replacing heating/cooling systems or roofs) or home remodeling, should do so before filing the FAFSA . Use cash to reduce your family’s assets reported to FAFSA, not credit, as debt does not reduce your expected family contribution (EFC) from total income for FAFSA.
FAFSA allows you to shelter roughly $20,000 to $35,000 (typically closer to $20,000) in assets from being considered as part of your expected familycontribution (EFC). Any cash in excess of these amounts should be used to pay down your debt or strategically sheltered from the formula in another manner.
Look for the next step from this article in our coming blog post. Please attend one of our free seminars for more strategies for paying for college.