Family Income, Assets and Debt:

• The parents annual income of $73,000

Family assets and debt consisted of:

$62,000 in home equity
$112,000 in retirement accounts
$10,000 in cash/savings
They had consumer debt of $21,000
The child had $23,000 in a UGMA account, established by grandparents

Family Goals:

• The family wanted to maximize the child’s eligibility for financial aid at a public university that costs $17,000 per year.

Solutions:

• In general, certain assets were repositioned
• Retirement strategies were incorporated to reduce the parents’ taxable income.

(Note: The strategies utilized are proprietary to My College Planning LLC)

Results:

• The child increased her eligibility for financial aid at the university by $9,700 per year
• The family saved $9,700 PER YEAR in college costs as we were able to help the student increase her eligibility for financial aid at the university.  

Case Study #2:     Employee whose child WILL NOT QUALIFY for Financial Aid

Timeframe:  Short-term – Student entering college in one year

Family Income, Assets and Debt:

• The parents had annual wage income of $170,000

Family assets and debt consisted of:

• $160,000 in home equity
• $290,000 in retirement accounts
• $70,000 in stock options
• $30,000 in mutual funds
• $15,000 in cash/savings
• They had consumer debt of $25,000
• The child had $23,000 in mutual funds

Family Goals:

• The family wanted to pay for the cost of a $35,000 private college in the most tax-efficient manner
• They wanted to increase cash flow (the amount of cash on hand) to meet college cost
• They were also concerned about having the child admitted to the elite private college

Strategies:

• The family would implement a loan consolidation strategy
• The family would take advantage of a little known tax election
• Student consulting to increase the child’s admission chances at the elite private college.

(Note: The strategies utilized are proprietary to My College Planning LLC)

Results:

• The family’s cash flow was increased to pay for college without any increase in income tax liability
• The child was admitted to an elite private college

Case Study #3:  Business-owner whose child MAY QUALIFY for Financial Aid

Timeframe:  Short-term – Student entering college in one year

Family Income, Assets and Debt:

• The parents had annual business income of $65,000

Family assets and debt consisted of:

• $90,000 in home equity
• $110,000 in retirement assets
• $140,000 in business equity
• $9,000 in cash/savings
• They had consumer debt of $15,000
• The child had $8,000 in CDs

Family Goals:

• The family wanted to maximize the eligibility for financial aid
• They wanted to maximize their child’s acceptance at multiple universities both public and private. 

Strategies:

• Certain assets would be repositioned
• Tax strategies would be used to lower the business income in order to maximize the child’s eligibility for financial aid
• A series of steps were established to increase the child’s acceptance rate.

 (Note: The strategies utilized are proprietary to My College Planning LLC)

Results:

• Total annual savings to the family was $17,500 per year
• The student’s financial aid eligibility was increased by $7,500 per year
• The child was accepted to multiple schools

Case Study #4: Business-owner whose child WILL NOT QUALIFY for Financial Aid

Timeframe:  Short-term – Student entering college in two years

Family Income, Assets and Debt:

• The parents had annual business income of $140,000

Family assets and debt consisted of:

• $210,000 in home equity
• $320,000 in retirement assets
• $380,000 in business equity
• $40,000 in mutual funds
• $18,000 in cash/savings
• They had consumer debt of $26,000
• The child had $18,000 in mutual funds in a UGMA

Family Goals:

• The family wanted to utilize the business to pay for estimated annual college costs of $30,000 with pre-tax dollars
• They wanted to increase cash flow without taking funds from the business for college expense

Strategies:

• Using a corporate tax professional a combination of employment and tax-free benefit strategies, and education tax incentives would be incorporated to help pay for college with pre-tax dollars
• The family would increase personal cash flow and avoid taking funds from the business by incorporating a loan consolidation strategy

(Note: The strategies utilized are proprietary to My College Planning LLC)

Results:

• The family saved $26,000 in income taxes per year that were used to pay for college
• The family’s personal cash flow was increased by $925 per month without robbing the business for college expenses