Tax consequences: Of the $8,000 earned, $5,000 is exempt leaving $3,000 subject to 10% federal and $8,000 subject to 7.65% social security and Medicare = 300 + 612 = $912 lost.
3. In the above example, let's assume the student banked $5,000 and listed it on the FAFSA. The student would lose an additional 20% or $1,000 just for having it! Of the $8,000 earned, the total amount of financial aid lost in taxes and assessments would equal $4,412, or 55%!
4. Even if the student has no earnings but will attend one of the elite private and/or state colleges that require the FAP, there will still be an automatic income assessment of $1,000! However, this can be avoided - if you know how.
Other strategies which have literally saved families millions of dollars over the years include:
· The ambiguous noncustodial parent strategy, which has reduced the cost of college by as much as 90%;
· The winter clothing allowance, which has saved students from southern states attending northern schools as much as $2,600;
· The "no work" work-study award, which has been worth as much as $8,000 over 4 years;
· Strategically negotiating for the best possible financial aid package, much like wheeling and dealing for the best price on a new car, has produced incredible results; and
· Professional Judgment, which few families are aware of, comes into play when there has been a significant change in family income, assets, marital status or health.
In order to win the college funding game (which repeats itself every year), a family must have the most up to date information, precise timing, persistency - and/or professional counseling from an expert in income planning and asset repositioning to do battle in the arena the College Funding Process has become...
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