According to the National College Achievement Network, in March the number of applications decreased by 8.9% compared to last year. (FAFSA season opened on October 1, but it’s not too late for students who haven’t applied.)
In normal years, high school graduates miss billions of federal grants because they don’t fill the FAFSA. Many families mistakenly believe they are will not qualify for financial aid and don’t even bother to apply.
Meanwhile, tuition fees at the college are rising. Tuition and fees plus accommodation and meals at the four-year private college averaged $ 55,800 in the 2021-22 academic year; in four-year public state colleges it was $ 27,330, according to the college council, which tracks trends in pricing in colleges and student assistance.
“If you haven’t already submitted your FAFSA, update your savings amount as of the date of signing, as a lower account value could mean qualifying for additional financial assistance,” said Kyle Harpin, investment analyst Edward Jones.
For families who have already applied to the FAFSA but have since experienced financial failure, one can also make changes to the FAFSA form or ask the college’s financial aid office for more help, he said.
“Your student’s school financial aid service can still help depending on how market volatility has affected you, so contact them.”
However, when it comes to financial aid, changes in these accounts are less important than income disruptions – from job lossfor example, according to Kalman Channy, a financial aid consultant and author of The Princeton Review, Paying for College.
Colleges are more likely to perceive appeals, he added, but “they usually can’t adjust assets”, which are already less credited in determining your eligibility for benefits, Channy said. “Next month, the market could grow by 10%, so they don’t usually do that.”
“You can ask them, but they can say no,” he added.
The best plan is to move the portfolio allocation to more conservative assets as the college approaches.
Typically, plans 529 offer age portfolios that start with greater exposure to stocks in the early stages of a child’s life and then automatically adjust, so as you approach college, the portfolio will shift toward more conservative investments such as bonds.
“A lot of people keep it in stock because they don’t want to miss it,” Channy said. But “you don’t want all your eggs to be in stock.”
“Once your child is in high school, you want to be in the age distribution model,” he advised. “The risk of missing up is less than a huge downturn – you’ll still have to pay for college.”