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Should a Family with a Trust Fund Fill out the FAFSA?

Written by Sally Rubenstone | Nov. 3, 2008

Question: My father left money in trust for my daughter's education. There's enough to cover one--maybe two--years at a private college. Income is less than six figures, but we do have some investments. Any reason we should do the PROFILE and FAFSA?

When a student applies to college as a "No Need" candidate (i.e., he or she does not ask for financial aid) then there is usually a waiting period (typically two years but it can be longer) before the student can apply for aid. Thus, if you might have only enough money from your father's trust to cover one year of your daughter's college, then you should definitely go through the hassle of completing the FAFSA (and the PROFILE where required. Also some colleges have their own forms, too).

Even if you don't get any aid for her first year due to the trust fund, this would leave the door open for an aid application for her sophomore year, as required. If your income is less than six figures, you will likely qualify for need-based aid, depending on the extent and nature of your investments. If your daughter is applying to any colleges that don't require the PROFILE, then her odds of getting aid are even better (This will vary by school. PROFILE colleges are generally the ones with the most dough to give away, but a number of FAFSA-only colleges have good aid, too--especially Merit Aid.) Also, by completing the FAFSA, you may be eligible for some loans that you could not get without it.

So my advice would be to bite the bullet and do the forms. Most folks say that they're not as bad as they expected (which is the same thing I say about my family Thanksgiving every year ... though last year was pretty bad. :-) )

Sally Rubenstone

Sally Rubenstone knows the competitive and often convoluted college admission process inside out: From the first time the topic of college comes up at the dinner table until the last duffel bag is unloaded on a dorm room floor. She is the co-author of Panicked Parents' Guide to College Admissions; The Transfer Student's Guide to Changing Colleges and The International Student's Guide to Going to College in America. Sally has appeared on NBC's Today program and has been quoted in countless publications, including The New York Times, The Washington Post, USA Weekend, USA Today, U.S. News & World Report, Newsweek, People and Seventeen. Sally has viewed the admissions world from many angles: As a Smith College admission counselor for 15 years, an independent college counselor serving students from a wide range of backgrounds and the author of College Confidential's "Ask the Dean" column. She also taught language arts, social studies, study skills and test preparation in 10 schools, including American international schools in London, Paris, Geneva, Athens and Tel Aviv. As senior advisor to College Confidential since 2002, Sally has helped hundreds of students and parents navigate the college admissions maze. In 2008, she co-founded College Karma, a private college consulting firm, with her College Confidential colleague Dave Berry, and she continues to serve as a College Confidential advisor. Sally and her husband, Chris Petrides, became first-time parents in 1997 at the ripe-old age of 45. So Sally was nearly an official senior citizen when her son Jack began the college selection process, and when she was finally able to practice what she had preached for more than three decades.