Tips For Parents Of High School Juniors

Dear Parent, 

When I talk to parents of college-bound children, I hear many of the same questions. Whether their child is heading for an Ivy-League college or the nearest public university, parents seem to have many similar concerns and questions about college funding. 

With that it mind, I’d like to present the most common questions I hear, and give you the answers that you can’t get from the guidance and financial aid officers. As the parent of a high school Junior, this is a very important time in the process.

Tip #1: Make The Most Of This, Your “Base Financial Year.”

When the college funding officers decides on your child’s financial aid package for next year, they look at your family’s financial data for this year. This is known as your Base Financial Year.  As the parent of a high school junior who will start college in the fall (after graduating from high school), this year is your Base Financial Year.  Any financial moves you make this year, such as accepting a pay raise, refinancing your home, buying stocks, liquidating assets or getting a divorce, will affect your eligibility for college funding next year.  These and any other moves can have either a positive or negative effect on the data you provide on the financial aid application next year.  So, please heed this advice:  Plan and strategize carefully this year, so you can get the biggest possible piece of the financial aid pie next year. It’s important to take whatever legitimate steps you can to put your income, asset and tax situations into the most favorable light for financial aid.  And, yes, there are many perfectly legal and ethical ways to do this. I can help you analyze your particular situation and guide you in making the most of your Base Financial Year.  Finishing the planning in the Junior year is the best of all situations! 

Tip #2: Encourage Your Child To Start Looking At Potential Colleges. 

It’s certainly not too early to start this process!  Have your child send away for catalogs and admissions applications, and begin thinking about what he or she wants in a college.  You and your child may also want to visit some schools of interest.  For our Platinum Service clients, Dale will be a valuable resource for college searches. 

I always encourage parents to have their child apply to six to eight schools.  This will significantly increase the chances that your child will get accepted somewhere.  Then, you’ll have more options and negotiating power when it comes time to sort through the schools’ financial aid offers.  You may even be able to get two or more schools to compete for your child’s attendance by offering you a more attractive financial aid deal.  It doesn’t happen all the time, but you never know!

Tip #3: Get A Ballpark Idea Of Your Estimated Family Contribution.

Your Expected Family Contribution (EFC) is the minimum amount of money you will be expected to pay out of your own pocket no matter where your child goes to college. The EFC is calculated using one of two methods: the Federal Methodology or the Institutional Methodology.

The Federal Methodology is used at all state schools and some private schools.  The Institutional Methodology is used by many private schools to determine eligibility for their own funds.  It includes assets, such as your home, which are not included in the Federal formula.  As a result, an EFC calculated with the Institutional Methodology can be higher than an EFC that is calculated with the Federal Methodology, although this is not always the case. 

Tip #4: Consider Last-Minute Strategies For Reducing Your EFC. 

If your Expected Family Contribution (EFC) seems to be a bit of stretch (or bigger than Mount Everest), don’t panic.  You may still have some options.

If your eyes are glazing over, don’t worry: We can help you sort through all this and help you get an idea of your EFC for next year.  Then, we explore some income, asset and tax planning strategies that could save you a lot of money next year. In fact, we’re here to help you with all your college funding questions and concerns, regardless of your child’s age or circumstance.  Just give us a call at (602) 840-5665 to set up an appointment or to discuss all of our services.  You can also visit our website campusadvisers.com for a schedule of our upcoming FREE College Funding Workshops in your area if you’d like to refer a friend. 

Until next month…Best Wishes!

Randy Stoltz, President