This is such a timely thread! I'm dealing with the exact same confusion right now. My husband has stock from two different employers - some from his current company through their employee stock purchase plan, and some from his previous company that he received as part of a retention bonus. Both are just sitting in regular brokerage accounts since we haven't figured out our long-term plan for them yet. Reading through everyone's responses, it's crystal clear now that we need to report both sets of employer stock since they're not in retirement accounts. I was getting hung up on the fact that one was a "bonus" and the other was "purchased through payroll deduction" but I see now that the source doesn't matter - it's all about the account type. One follow-up question though: if we sell some of these stocks before submitting the FAFSA (we were already thinking about diversifying anyway), would that help or hurt our aid eligibility? I'm wondering if having cash instead of stocks changes how it's treated on the FAFSA, or if it's basically the same either way since both would be reported as assets.

I went through this exact same confusion when filling out my daughter's FAFSA last year! The employer stock question is super tricky because the terminology is confusing. Here's what I learned after speaking with a financial aid counselor: The key is WHERE the stock is held, not HOW you got it or WHAT you plan to do with it. If your husband's employer stock is sitting in a regular brokerage account (like E*Trade, Fidelity, etc.), then yes, you absolutely must report it as an investment on the FAFSA. It doesn't matter that it came from his employer or that you're saving it for retirement - the FAFSA only cares about the account type. The only employer stock you DON'T report is stock that's actually held inside a qualified retirement plan like a 401(k). Some companies do offer this option where your employer contributions can be in company stock within the 401(k) itself. For your other stock investments in your portfolio, same rule applies - if they're in regular taxable accounts, report them all at current market value. I found it helpful to log into all our accounts on the same day and take screenshots showing the total values, then add everything up. Don't stress too much about getting the exact perfect number - just make an honest effort to be accurate as of the day you submit!

just wanna add that my kids financial aid officer told us its usually not worth worrying about unless its over like $10k. small amounts dont change the SAI that much

I went through this exact situation with my daughter last year! Here's what I learned: scholarship money sitting in a bank account does count as a student asset on FAFSA, but there are ways to handle it. First, keep all documentation showing the money came from scholarships - this is crucial if you need to appeal later. Second, consider timing your FAFSA filing strategically. If your daughter can use some of that money for legitimate educational expenses before you file (like buying textbooks, paying housing deposits, or pre-paying utilities), it reduces the reportable asset amount. At 20% assessment rate for student assets, $3,000 would potentially reduce aid by about $600, so it's worth managing carefully. Also check if her school offers a scholarship fund management service - some universities will hold unused scholarship money in restricted accounts that don't count as personal assets on FAFSA.

As a parent who went through this exact same confusion two years ago, I totally understand your overwhelm! Here's what I wish someone had told me upfront: The key date to focus on is about 10 days before classes start - that's when aid typically disburses to your daughter's student account. The school automatically applies it to tuition/fees first, then if there's excess, that becomes the "refund" (which isn't really a refund, just leftover aid money). My biggest tip: don't panic if the refund takes a week or two after classes start to hit her bank account. We made the mistake of buying all her textbooks upfront thinking we'd get reimbursed immediately, but it took about 10 days. Now I know to either wait for the refund or use the school's book advance program if they have one. Also, encourage your daughter to treat any refund money like it has to last the ENTIRE semester - I've seen too many kids blow through it in the first month and then stress about money for the rest of the term. Setting up that separate account someone mentioned earlier is genius! The financial aid office saying "it's automatic" is actually true once all the paperwork is done - but definitely confirm she's completed everything on her to-do list in the student portal. You've got this!

As a first-time college parent who just went through this last semester, I want to echo what everyone's saying about the timeline being mostly predictable once you understand it. One thing that really helped us was calling the financial aid office in July to ask for the specific disbursement date for fall semester - most schools know this well in advance and can give you an exact date rather than just saying "10 days before classes." Also, a heads up that if your daughter is selected for verification (about 1 in 3 students are), it can delay everything by several weeks. The school will ask for tax transcripts, bank statements, etc. If this happens, don't panic - just get the documents submitted ASAP. We were selected and it pushed our disbursement back by almost a month, but the school was understanding about payment deadlines. One last tip: if your daughter gets work-study as part of her aid package, that money doesn't disburse automatically like grants and loans. She actually has to find a work-study job on campus and earn that money throughout the semester. Just mentioning it since it caught us off guard when we were budgeting!

I'm so sorry for your loss, Yara. I can't imagine how difficult this must be while you're also trying to navigate these complex financial aid processes. Based on what everyone has shared, it sounds like you have a clear path forward, but I wanted to add one more resource that might help: many colleges have emergency financial aid funds specifically for students whose families have experienced unexpected hardship like this. When you contact the financial aid offices for the professional judgment reviews, ask if they have any emergency grants or hardship funds your son might qualify for while you're waiting for the FAFSA adjustments to be processed. These funds can sometimes provide immediate relief for tuition, housing, or other expenses. Also, don't forget to check if your husband had any life insurance benefits through his employer that might include educational benefits for dependents - some policies have provisions specifically for college expenses that families don't always know about. You're handling this incredibly well given the circumstances.

I'm so sorry for your loss, Yara. This thread has been incredibly helpful - I'm saving it because my family might face a similar situation with my dad's health issues. One thing I wanted to add that I learned from a financial aid workshop: when you're gathering documentation for the professional judgment review, make sure to include any expenses that have changed too, not just income. For example, if you had to take on new costs like daycare, transportation, or medical bills, or if you lost benefits like health insurance coverage, include documentation of those changes as well. Schools can factor in both decreased income AND increased expenses when they recalculate your aid eligibility. Also, some schools will expedite the review process if you explain that you're facing immediate financial hardship, so don't hesitate to emphasize the urgency of your situation. You're being so strong through all of this.

I went through this exact situation two years ago when my son inherited money from his grandfather's Roth IRA. The key thing to remember is that the FAFSA timing matters a lot here. Since you're filing the 2025-26 FAFSA, you'll be using 2023 tax information for income reporting, so that 2022 distribution won't show up in the income section at all. For the asset reporting, you'll need to include whatever amount your daughter still has from that inheritance as of the day you file the FAFSA. The $14k mentioned in the comments would add about $2,800 to her Student Aid Index, which could reduce her aid eligibility. One strategy that worked for us was using some of the inherited funds for legitimate college expenses before filing - things like a laptop, textbooks, dorm supplies, or even paying the enrollment deposit. This reduced the reportable asset amount while still using the money for its intended purpose. Just make sure to keep all receipts in case you need to document the expenses later. Also, if any of her schools require the CSS Profile, double-check their specific requirements since they sometimes have different rules than the FAFSA for inherited assets.

As a financial aid advisor, I can confirm the advice given here is mostly accurate. For the 2025-26 FAFSA using 2023 tax data, that 2022 Roth IRA distribution won't appear in the income section. However, I want to emphasize a few key points: 1. Any remaining funds ($14k mentioned) will be assessed as student assets at 20%, potentially reducing aid by about $2,800 2. Using funds for legitimate educational expenses before filing is a valid strategy - this includes tuition deposits, required technology, textbooks, and even reasonable transportation needs 3. Keep detailed records of all purchases in case schools request verification 4. For schools requiring CSS Profile, contact their financial aid offices directly as they may have additional reporting requirements One thing I haven't seen mentioned: if your daughter qualifies for the simplified needs test (family AGI under $60,000 and eligible to file 1040EZ or meeting other criteria), assets aren't counted at all on the FAFSA. This could make the entire asset question moot depending on your family's income situation. The key is being honest and accurate while understanding the rules to make informed decisions about timing your FAFSA filing.