Question: When we used a Website to calculate our EFC, it came up with a figure that was approximately 30% of our income. We do not really have any liquid assets and are paying parochial school tuition for four children. My son made the first cut for the National Merit Scholarship last year, and we have not heard anything further on that, but even with that distinction, most of the schools that he is applying to only give a few merit-based scholarships. Do colleges seriously expect families to pay 30% of their income for one student in college?

No, this didn't seem right to me either. You didn't give me a ballpark household income, so I used an easy online EFC calculator and played around with some different income levels and assets for "you." I typically got an EFC that was far lower than 30% of the fabricated income. At one point, I even "gave" you a $500,000 house that was paid in full. This had no impact on colleges that use the "Federal Methodology." (These schools don't look at home equity.) And even though it did have significant effect on those using "Institutional Methodology" (i.e., the colleges that require the CSS Profile form and sometimes their own additional form), it still didn't bump the EFC as high as the outcome that you found. So then I raised the value of "your" house to $900,000, and it was only then that the Institutional Methodology figure jumped to about 30% of the income I'd created (which was $120,000 for that particular home).

So, if you own a pricey house, that might be a factor in the figure you're getting. However, many colleges that use the Institutional methodology will put a cap on the home value. And that cap is typically 2.4 times the household income. So, if my imaginary family of six has an income of $120K, the colleges wouldn't look at their million-dollar home, only at a theoretical home worth $288,000, which wouldn't do much to inflate the EFC at all.

My best guess (and it's just a guess indeed) is that you made a mistake when you were entering your figures. Did you use the College Board's online calculator? If not, try it here: http://apps.collegeboard.com/fincalc/efc_welcome.jsp?noload=Y

Or maybe you have substantial non-retirement investments that may not be liquid but would still go to the bottom line. For instance, last year I worked with a boy whose household income was very low. But his father had been given a large plot of undeveloped land in another state by the grandparents, which had been handed down for generations in this family and which the father co-owned with his brother ... the student's uncle. The land had recently been reassessed, and its value had jumped significantly, but the student's father had been told by his parents and his brother that the land needed to stay in the family and couldn't be sold. So the student's EFC skyrocketed due to the assessed value of the land, but the father wasn't in a position to unload it to help cover college costs. So perhaps it's some atypical non-liquid asset like this that is messing you up?

You should also feel free to contact colleges that your son is considering to ask them to give you a preliminary idea of what you might pay there. You are correct when you say that National Merit money is negligible ... or non-existent ... at many "elite" colleges.

Finally, when you complete your financial aid forms, you can send a separate explanatory letter to colleges that provides important information (such as the tuition for your younger children) that your forms may not cover. Colleges tend to treat such information differently (i.e., some will take it into account and others won't). But it makes sense to paint as clear a picture as possible of your family's financial situation before the needs analysis is finalized.