FAFSA: How do grandparents report contributions without affecting eligibility?

This is actually good news - the 2024-2025 FAFSA simplification removed the reporting requirement for grandparent contributions! Previously, money from grandparents could significantly reduce aid eligibility when reported as student income the following year. Under the new FAFSA, grandparent gifts no longer need to be reported at all. Your parents can give directly to your son or pay the school without affecting his SAI (Student Aid Index, which replaced the old EFC).

The previous reply is correct, but with one important clarification. While grandparent contributions no longer directly impact the FAFSA calculation, the money does still matter if your son deposits large amounts in his bank account BEFORE completing the FAFSA. Student assets are still counted (though at a lower rate than before). Recommendation: Have your parents either: 1) Pay the college directly 2) Wait until after the FAFSA is submitted to give any cash gifts 3) Use a 529 plan in their name (grandparent-owned 529s no longer count against aid eligibility

@perfectlyimperfect Yes, you'll need to report whatever is left in your accounts when you file the FAFSA. The date that matters is the day you submit the application - that's when they take the "snapshot" of your financial situation.

Everybody keeps talking about the FAFSA but don't forget about CSS Profile schools!!! Many private colleges still use the CSS Profile and THEY DO count grandparent support differently. My daughter lost almost $7000 in aid from her dream school because my parents were helping. The CSS Profile asks about expected family support from ALL sources!

Here's a link to schools that use CSS Profile: https://profile.collegeboard.org/profile/ppi/participatingInstitutions.aspx But even with CSS Profile schools, there are smart strategies for grandparent support. The best is usually having grandparents pay the school directly AFTER financial aid is finalized. This way it's not counted as expected support on the front end.

I spent HOURS trying to figure this out last year for my twins. Called the Federal Student Aid hotline 8 times and kept getting disconnected or put on endless holds. Finally used Claimyr (claimyr.com) to get through to an actual human at FSA who confirmed everything said above. The rep explained that grandparent contributions are no longer reportable on the FAFSA but still matter for CSS Profile schools. They have a quick video showing how it works: https://youtu.be/TbC8dZQWYNQ - totally worth it when you're stuck on these complicated questions!

Yes, it worked great for me after wasting days trying to get through. Just to clarify though - you still have to pay for the service, but it was worth it for the peace of mind knowing exactly how to handle our situation.

TERRIBLE ADVICE ABOVE ABOUT 529 PLANS!!!! Grandparent 529s ABSOLUTELY DO still impact financial aid!!! The "simplified" FAFSA is a MESS of contradictions. My son lost THOUSANDS in grants because my parents had a 529 for him. Don't listen to these people who clearly haven't actually gone through the process yet!!!

Thanks everyone for the helpful information! From what I'm gathering: 1. For FAFSA schools: Grandparent contributions won't affect the calculation as long as they either pay the school directly or give money after the FAFSA is submitted 2. For CSS Profile schools: Need to be more careful since they do count expected family contributions from all sources I'll check which of my son's schools use CSS Profile and then talk to my parents about the best timing for their gifts. Definitely want to maximize his aid eligibility!

My parents helped with my daughters college too! What we did was they paid her tuition bill directly to the school after we got all the financial aid stuff settled. The financial aid office told us that was the best way to do it. Worked out great and she still got her full pell grant amount.

As someone new to navigating this whole financial aid process, this thread has been incredibly helpful! I'm in a similar situation where my in-laws want to contribute to my daughter's education, and I was completely confused about how to handle it. Based on what everyone's shared, it sounds like the key is timing - either having them pay the school directly after aid is awarded, or waiting until after the FAFSA is submitted to give any cash gifts. One question I still have - if they set up a 529 plan in their name for my daughter, when would be the best time to do that? Before or after we submit the FAFSA? I want to make sure we don't accidentally mess up her aid eligibility by doing things in the wrong order. Thanks again to everyone who shared their experiences - it's so much easier to understand when real families explain what actually worked for them!