Asset Protection Allowance – What you need to know to get the most free college financial aid

Asset Protection Allowance

There’s been an update to the Financial Aid Formula.

The Department of Education has reduced the Asset Protection Allowance, or APA.  The APA is the amount of money you’re allowed to have before they start counting your assets against you in the financial aid formula.

Below is a chart that shows the change over time for a married couple where the older parent is 48 years old.  In 2013, you could have had $40,000 in the bank with no impact to your financial aid.  For this coming January’s FAFSA submission (the 2016-17 school year), you can only have $18,700.

asset-protection-allowance-older parent-age-48-line-chartSo what does this mean to you?  If you had left $40,000 of assets visible to the financial aid formula and we haven’t adjusted your plan… you just lost about $1,200 of need based financial aid potential for the 2016-17 school year.

The last thing we want are surprises that will cost us.  If you haven’t recently to reviewed your college financial plan (or if you don’t have one), please schedule a meeting with me to review everything and make sure you’re on track.  

Let me know what you think. Ready... Go!