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College Fund

The best college saving plan is a plan that can send your kid(s) to the best college without saving as much or saving at all. If you understand how Federal Financial Aid program works, this is sometimes not hard to achieve. Many parents assume that their kids are not eligible for Federal Financial Aid program due to their income, asset, and investment. Such parents along with their friends could miss their biggest opportunities on financial aid program.

Applying for federal financial aid program is not as simple as filling out the application forms. You must understand how to minimize or eliminate Effective Income and/or Effective Savings/Assets. Income that decrease the amount of financial aid is called effective income. Savings or assets that decreases the amount of financial aid is called effective savings/assets. 401(k), IRA, Annuities, Cash value of life insurance, and primary home equity are excluded from parent assets for the purpose of calculating effective savings and/or assets. EFC or Eligible Family Contribution are the amount the parent must pay towards to college expenses before financial aid kicks in. This years EFC may count as next school years effective income. However, distribution from 529-plan is not counted as income for the next year, making 529-plan better options for saving for college. Red Deer Insurance Agency help you reduce your effective income and effective savings by applying tax-saving strategies.

If your kids are going to college now but you have a lot of savings in the banks, we can help you setup an account that can shield your saving from counting towards effective savings/assets. After your kids are graduated from college, you can withdraw the money from the account with interests. Financial aid program are complicated, and changes yearly, please let our professional work out a plan for you now before it is too late.