Article by: Gregory Wagner
Founder of SmartCoparent and Certified Divorce Financial Analyst (CDFA)
Contributions by: Sandy Volt, MS, EdS, LMHC, CDFA

We attended a college financial aid masterclass

Run by a CDFA® and expert in the field. 

This article shares key observations

• Studies show that parents of divorced children contribute significantly less (about half) to college costs than parents who remain married.

• So, it is even more critical for co-parents and their children to maximize chances in receiving college financial aid.

• Navigating through the financial aid process can be very complicated. It becomes significantly more complex when dealing with parents living in different homes.

• Divorce financial aid experts have emerged to help navigate families through the web of confusion.

Sandy Voit of Tangible Solutions is a co-parenting financial aid expert and the speaker at our seminar. 

Here’s what we learned…

Start the process as soon as possible

• For students graduating in 2019, the financial aid applications should start to be filed in October of 2018, using your tax information from the 2017 tax year.

• Priority consideration for financial aid deadline is October 31st 2018 for students graduating June 2019.

• There are a few U.S. states that actually allocate financial aid based on a first-come, first-served basis.

Don’t miss the boat

• Everyone should apply for financial aid for the student’s freshman year (even families not initially expecting to receive any financial aid).

• It costs nothing to almost nothing to apply for financial aid and makes it easier to obtain aid in later years if unexpected circumstances arise.

• High school students who do not fill out financial aid forms for their college freshman year, face an uphill to near impossible process in obtaining aid in later years.

• There are a number of obscure scholarships available if you know where to look. There’s even one for left-handed students.

File smart and to your advantage

• Financial aid is based on need, so the parent with the least of amount of assets and income (presumably the support recipient / custodial parent) should file with the student.

  • The filing parent must prove that the student lived with him/her for more than 50% of the time to be considered the custodial parent for financial aid purposes.

  • Equal shared parenting can make this less clear, compared with traditional joint custody.

• Regardless, a student’s drivers license address is often used to determine his/her primary residence!

• Savings accounts in the student’s name will usually count against the student’s financial aid package more severely than if the same money was in the parent’s name instead.

” If more than one of your children will be in college at the same time, you can maximize their financial aid by crafting a custodial plan where one parent is the custodial parent for all the children who will be in college at the time the financial aid application is to be submitted. ” – Sandy Voit

The expected financial aid will likely be less if

• The custodial parent re-marries.

• The primary or shared house is sold and the profits are invested or kept in the bank.

• A home equity line of credit (HELOC) is taken out and the funds are put in the bank.

• A vacation home is purchased.

Final Thoughts

This is not an exhaustive list of key points for co-parents to consider when planning and applying for financial aid. Setting up custodial accounts and other strategies should be started at least 2 years prior to your student attends college. 

If there are multiple children going to college, or if there is a number of accounts / participants involved in contributing to the students’ education; seeking out a professional to map out the best financial aid strategy is likely a good investment.

If you want to learn more about how SmartCoparent can help you document the amount of time your child or children stay at each house, please check out our ‘Help’ articles below or drop us note at support@smartcoparent.com.

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Documenting Child Visitation

Tools to help you document time spent for shared parenting:

How to best track visitation schedules 

How to share calendar events

How to manage calendar alerts

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