This article was originally published here on November 28th, 2016. It was updated on April 16th, 2019.
Today I have urgent college financial aid info for parents of 9th graders.
Yes, I’m serious, 9th graders.
There’s something that you need to know right now—so you can carefully protect your child’s future college financial aid eligibility.
You need to know that coming up quite soon—on January 1st of your kid’s 10th grade year—a team of photographers is going to show up at your house.
Not actual photographers, but that’s a good way to think of it.
On that day, you’ll want to be prepared and ready for them.
This article will help you with that.
“Why is this ‘January 1st of 10th grade’ date so important that I need to think about it now?”
To answer, let me explain a little bit about how applying for college financial aid is going to work for you, when the time comes.
A long way off from now, in October of your child’s senior year of high school, you will be filling out a form that will determine your child’s eligibility to receive free money financial aid to help pay for college.
You will want to fill out this form even if you’re so rich that you’re convinced you could never get any help paying for college.
The federal government will use the information you put on this form to figure out “how much your family can probably afford to pay for college.”
Then, a few months after that, colleges your child is interested in will figure out how to help your family cover the costs it has been determined you “can’t afford.”
The big question is, “How does the federal government figure out how much your family can afford to pay for college”?
They figure it out by taking a one-year snapshot of your family finances.
Just one year.
If you happen to look a little bit poor during that year, your child will get far more free money to help pay for college.
If you happen to look wealthy during that year, your child will get far less free money to help pay for college.
“Wow—I’d better pay attention to this! When does this very important year start?”
This important year will start on January 1st of your child’s 10th grade year. It will end December 31st of your child’s 11th grade year.
Take a minute and count out the months right now. How long do you have before January 1st of your child’s 10th grade year? This is how much time you have to plan and prepare for this important snapshot year. This is how much time you have to show this article to a financial planner, if you’d like to do that.
Think right now about how you’ll want to look in this important snapshot.
If the shutter goes “click” and you appear to be flush with cash, then guess what. The response is going to be: “Well, this kid comes from a rich family! They can probably afford to write checks to cover all the college tuition! We won’t have to give these people any help!”
Parents, it’s possible for you to intentionally affect the content of this snapshot.
You have from today, to December 31st of your child’s 10th grade year, to use safe, legal strategies to adjust what your family finances look like—so that next year’s financial picture doesn’t accidentally make you look like you’re Bill Gates.
Let’s look at three simple examples of how parents can safely and legally affect the content of this snapshot.
1. If you’re currently a two-income family, look carefully at how that’s actually working out for you financially.
Some families do the math and realize—that the parent earning the lower income is barely turning a profit once the family factors in the cost of taxes, commuting, daycare, lunches out, and work wardrobe. At the same time, according to this post by Kiplinger, “Every $10,000 increase in parent income,” (during what I’m referring to as the snapshot year) “will cause about a $3,000 decrease in need-based financial aid.”
This is why your kid’s 9th grade year is a good time to do the math, look ahead, and ask yourself, “Might we come out ahead financially if during the snapshot year, the lower-income parent in our family were to quit work and put extra time and effort into helping the family live more frugally?”
2. If there’s a chance you’ll be selling one home and buying another during this next school year, watch out for this.
If you sell a $300,000 house and buy a $200,000 house—you’ll reap approximately $100,000 in cash profit. This will seem nice, until you find yourself losing as much as $30,000 in college aid because “every $10,000 increase in parent income (during what I’m referring to as the snapshot year) causes about a $3,000 decrease in need-based financial aid.”
You can still sell one house and buy another—you’ll just want to be sure you’ve strategized early on about where you’ll safely put the profit after you do.
I’ll direct you to a resource that helps with this, below.
3. If you anticipate that you might be getting a big bonus at work, a nice hefty sales commission, or a big insurance settlement, watch out for this.
Try to plan ahead and get that windfall money in and deposited into your bank account on or before December 31st of your child’s 10th grade year.
If that money hits your bank account just one day later, during what I’m calling the snapshot year, you’ll make yourself look far wealthier than you really are when this important family income picture is taken.
These are just three small examples of how parents can safely and legally affect the content of this snapshot.
You’ll find a complete list of strategies that help parents shape how they’re going to look during the snapshot year in Chapter 10 of my book:
You can “Look Inside” the book on Amazon for free by going to:
(Tell your friends.)
You can see why financial planners and wealth managers love LAUNCH, here.
You can see the top 9 questions parents are asking me about LAUNCH, here.
Read just one chapter of LAUNCH every 1–3 months while your child’s in middle school and high school, and you’ll know every viable strategy for debt-free college at exactly the right time to implement it.
And if your child’s already well past middle school? That’s OK; you can run to catch up. But the process of getting your kids through college debt-free goes more smoothly the earlier you start it—especially if you’re not planning to save up any money to pay for college.
The government doesn’t actually show up at your house with lights and cameras.
Though it might feel like that.
Don’t be like other parents who’ve found out about this too late and said, “Oh no! I wish I’d have known sooner that so much was hinging on this one year! I’d have planned better!”
If you’ve found valuable info in this article, please help me by tweeting it out to the people who follow you.
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Please click the LIKE or SHARE button on that Facebook post right now. You’ll be helping me get this info out to lower-income families who might never otherwise find out about it.
What about you?
What strategies have you found for getting maximum amounts of financial aid for your kids’ college? Comment below or LIKE Jeannie Burlowski Author on Facebook, find this post on that page, and let’s talk about it there.
Who is Jeannie Burlowski?
Jeannie is a full-time academic strategist, author, speaker, and podcast host. Her writing, speaking, and podcasting help parents set their kids up to graduate college debt-free and move directly into careers they excel at and love. Her work has been featured in publications such as The Huffington Post, USA Today, NerdWallet, and US News and World Report, and on CBS News.