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Featured 11.16.2016

When working to secure financial aid for college, it's important to understand which assets you should report, and which assets you can omit during the application process.

Student Aid and the Secrets to Success

If you have a child who just started their Senior Year of High School, then I know that the pressure of college applications is really starting to mount. And, while you’re finding yourself asking your child the same thing, every day, (“Have you started your college essay!?”) you are also filled with your own anxieties. “Will we get the financial aid we need?”

Many parents rely on Financial Aid to buoy their financial strategy for four years of college. But, many do not know which financial assets can hurt or help their chances of securing financial aid. Fear not. I have some answers for you.

The most common financial aid tool is the Free Application for Federal Student Aid (FAFSA). (Please note, some very selective schools also require that you fill out the CSS Financial Aid Profile, too. This Profile may count different assets than FAFSA. So for the purposes if this post, we will focus on FAFSA only.) Many parents are surprised to learn that these Financial Aid organizations ignore a significant number of assets when they are making their assessment as to whether or not they can help you.

Here are the assets that you DO NOT have to report on the FAFSA:

Equity in Family Homes

The FAFSA isn’t interested in equity of the family home. In fact, the document doesn’t even ask if you own a primary home.

Retirement Assets

Do not include qualified retirement assets on the FAFSA. You may find yourself confused, because the language isn’t specific. However, the following qualified retirement assets, should not be shared:

  • Individual Retirement Accounts
  • 401(k) accounts
  • 403(b) accounts
  • SEP-IRAs
  • Roth IRAs
  • Keogh
  • Pension plans

Annuities and Life Insurance

Do not include any annuities on the FAFSA. It makes no difference if the annuities are inside the qualified retirement account, such as an IRA or 403(b), or not. Also, refrain from declaring the cash value of any life insurance policy.

Household Possessions

It is unnecessary to share the value of cars, furnishings, jewelry and other household goods on the FAFSA.

Family Farm/Small Business

The value of a family farm is excluded if the family resides there and materially participates in the operations. The value of a small business is ignored if it has fewer than 100 full-time employees and the family owns more than 50% of the business.

Here are the assets that you DO HAVE TO REPORT:


The balances in your checking and savings accounts, will be counted as you are considered for Financial Aid.

Investment Farms

Any farm that you own but do not live/work on will be counted towards your Financial Aid status.


Other investments, such as real estate (other than the home in which you live), UGMA and UTMA accounts for which you are the owner, stocks, bonds, certificates of deposit, CDs, brokerage accounts, money market, investment real estate, stocks, bonds, mutual funds, ETFs, commodities – as well as – 529 college savings and prepaid plans will all be counted.




This information is not intended to be a substitute for individualized legal advice. Please consult your legal advisor regarding your specific situation.



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