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529 plan confusion as related to the fafsa

Newburyport, MA |

I have 2 kids and I have a 529 fund for each kid. Child 1 is now of college age. The fafsa takes both 529 funds together and uses that figure to determine child 1's efc. This is a rude discovery. I am now asking myself if I should just change the beneficiary of the 529 funds to child 1 and spend them down so that there is a prayer of child 2 getting some aid. (Both funds are in the parents name)

Attorney Answers 1

Posted

This isn't a legal question and really requires knowing more about the family finances to answer. I strongly suggest finding a local financial aid counselor.

E. Alexandra "Sasha" Golden is a Massachusetts lawyer. All answers are based on Massachusetts law. All answers are for educational purposes and no attorney-client relationship is formed by providing an answer to a question.

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3 comments

Asker

Posted

Thanks, I was thinking of it as a legal question because I am shifting financial assets from 1 party to another. I guess the reasoning behind it is the gray zone.

E. Alexandra Golden

E. Alexandra Golden

Posted

Financial aid planning is not something that lawyers generally know about or practice (except maybe as it would apply to their own children). You'll do far better off working with a financial aid specialist who deals with this sort of issue day in and day out.

Asker

Posted

thanks.