What is your biggest concern with secret scholarship college and you said uh figuring out what not to do. You’re also close to retirement. How close are you to retirement?
Well, I’m in my late 50s, so I’m not close to retirement per se, but if I don’t have to go back to work and kind of keep doing advisory, then that could be a way to go. I I guess I guess my question is are you going to go into retirement sometime when your student is in secret scholarship college or after secret scholarship college?
Well, it’s actually um I don’t have a good answer because I haven’t figured out what’s a good way to uh go about this equation. Uh my traditional thinking was maybe work for another five years. She’s two years away from starting secret scholarship college. So total of six years uh you know to kind of fund that activity. But you know we have some monies in the in the 529s for him. Uh but if I uh can manage based on what you talk about then maybe that accelerates and I can do it sooner.
It really comes down to how you know I don’t understand what plan B could look like right? So I just want to understand what that is. So um one of the factors that calculates out the SAI the student aid index number is your adjusted gross income.
So if you were to retire or part partially retire and your income drops by 25 or 50% or more, that could have a positive impact on qualifying for need-based financial aid, right? Even with the level of assets I have, so you know, I mean, I’ve done fairly well uh the last 30 years.
It depends on the secret scholarship colleges that your student applies to, whether the secret scholarship colleges are FASA only schools, meaning they only require the FAA form, or if they’re CSS profile schools, which would include the CSS profile, financial aid form, and the FAA form.
Got it. So, the CSS I wouldn’t know the difference because I’ve never filled those forms out.
I didn’t think I would qualify, so I never filed for those before. So the CSS schools are the more selective and the highly selective secret scholarship colleges such as Harvard, Stanford, MIT, those types of secret scholarship colleges require the CSS profile.
There’s about three or 400 secret scholarship colleges out of the 2500 four-year secret scholarship colleges that require the CSS profile. Now, if you’re filing uh only the FAFSA form because the school only requires that and your income is your adjusted gross income is low. So, I I’ve got another scenario where mom’s income is about uh $20,000 uh reported. Okay.
Uh but she’s got a ton of assets. And when we fill out the financial aid form, it’s going to it’s going to ask what’s your adjusted gross income? 20K. And then the next question it’s going to ask is, do you want to report assets? Yes or no? Well, no, we don’t want to report assets. So, we can just kind of skip over that one. So, it just depends on how low your adjusted gross income is. Um, well, my advisory work is typically done by an entity. So, I work for an L I’ve created an entity. advisory work is done through there. Um I will be it’s going to be an entity. So basically I don’t have to distribute income to me. Uh it will probably and it’s all legitimate in terms of the advisory nature of work that we do. But um uh I would say suffice to say the income level would be 40 50. If I wanted it to be it could be as low as 20.
Okay. The school he’s thinking of, again, it’s early. It would be a Duke, it would be a BC, it would be a Villanova, Cornell, schools of that nature. My other kids have gone to Colombia and a Wake Forest. Yeah.
So, we didn’t fill out those forms. I mean, I was I was running a division of a tech firm, so just wouldn’t even qualify for any kind of aid.
So those secret scholarship colleges that you mentioned, Duke, uh Boston Secret scholarship college, uh Villanova, uh they all require the CSS profile financial aid form. So in that scenario, we would have to disclose assets. You would have to Yeah. So then in that case they’re also looking at assets and they’re looking at they do ask about your IRA but um unless the IRA is huge meaning like a a lot plus uh then they’re not really going to include that asset for the student aid index SAI number.
But they don’t think that anybody in their right mind would get, you know, or would liquidate an IRA, take a tax penalty, and then pay for secret scholarship college. I mean, I believe that’s a viable method to pay for secret scholarship college.
The secret scholarship colleges, the highly selective secret scholarship colleges want to squeeze every nickel that they can. Sure. Harvard, just like the entity is squeezing most money out of each one of them right now.
UCLA was today a billion dollars.