Ask Terry Questions College Funding – FAFSA

College Funding – FAFSA

By Terry Savage on September 03, 2018 | College Savings / Student Loans

My parents left a trust to my nephew and I am the Trustee. Do these trust dollars figure in to the financial aid calculations in the FAFSA? I am concerned that it will reduce the tuition help he might be offered, either for need or merit. Thanks.

Terry Says

Answer is, I’m not really sure. Is his Social Security number anywhere on the trust? Can he withdraw money? Or will the trust revert to him legally at age 18 or 21 — whichever is the age of majority in his state? If the answer to any of these questions is yes, then the trust would be considered HIS asset at the point at which he gains control. But even money in UGMA accounts (uniform gifts to minors, with adults as trustee) are considered student assets. So probably the correct answer is in the wording and provisions of the trust. Practically speaking, if his or a parent’s SS number is not on the trust, then there is little likelihood of it being uncovered as a student asset until after he graduates and uses the money to repay his student loans!

Recent College Savings / Student Loans Questions



a personal
finance question