Financial Aid Maze

Physician's Money DigestFebruary28 2005
Volume 12
Issue 4

The hitch:

If you're putting tuition money into aSection 529 plan, you should be aware ofhow the funds will affect any financial aidpackage when your child starts applyingto colleges. If the funds are in your name,the federal government's aid formulacounts 5.6% of the assets as eligible topay for college expenses. If the money isin the student's name, the formula maygrab up to 35% to pay for collegecosts. Those rules do not applyto private colleges, which may use a differentformula to determine aid. An individualcollege may take all of your family'sassets into account when allocatingfinancial aid, no matter who owns them.

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