FAFSA parent assets confusion - Do 401k and primary home equity count?

Good news! You do NOT include retirement accounts (401k, IRA, pension plans) on the FAFSA. The federal methodology specifically excludes these from consideration when calculating your SAI (Student Aid Index). Same goes for your primary residence - the equity in your home is not reported on the FAFSA. 'Real estate' on the FAFSA only refers to investment properties besides your primary home (rental properties, vacation homes, etc.). Hope this helps you finish up that application!

You're totally overthinking this lol. Just put what you have in the bank and stocks if you got em. Thats what I did for my son. They dont care about ur house or 401k.

Just to clarify some of the earlier information - the FAFSA specifically excludes these assets from consideration: 1. Primary residence (your home) 2. All retirement accounts (401k, 403b, IRA, pension plans) 3. Life insurance policies 4. Family-owned small businesses with fewer than 100 employees What you DO need to report: 1. Cash, checking, and savings accounts 2. Non-retirement investments (stocks, bonds, CDs, mutual funds) 3. 529 college savings plans (reported as a parent asset) 4. Investment real estate (rental properties) 5. Cryptocurrency holdings For your rental property, you'll report the net value (current market value minus debt owed on it). A reasonable estimate is fine - no formal appraisal needed. Just be prepared to explain how you arrived at that value if questioned during verification.

WATCH OUT with the CSS Profile though! If your daughter is applying to private colleges that require the CSS Profile in addition to FAFSA, that DOES ask about home equity and retirement in some cases. Every school uses the information differently, but the CSS is much more comprehensive than FAFSA. They ask about everything including the kitchen sink. Made that mistake with my first kid and was completely unprepared for how much more detailed it is.

just finished my FAFSA last week!!!! was so confusing. had to call them 3 times to figure it out. but yes they told me NO on the 401k and NO on my house. only my checking account and the duplex we rent out. good luck!!!

I tried calling the Federal Student Aid helpline to clarify these same questions last month and was on hold for over TWO HOURS before getting disconnected. Totally infuriating. I finally used Claimyr (claimyr.com) to get through - they hold your place in line and call you when an agent is available. Saved me so much time and frustration. They have a video showing how it works: https://youtu.be/TbC8dZQWYNQ The agent confirmed what others have said - no 401k or primary residence on FAFSA, but yes on other investments and rental properties. Getting a definitive answer directly from FSA gave me peace of mind.

One more important point regarding assets: the FAFSA takes a snapshot of your assets on the day you submit the application, not over time. So if you have any major purchases planned that would reduce your bank accounts (like a new roof, car purchase, etc.), consider making those before submitting. Completely legitimate strategy. The other thing to remember is that parents' assets only impact the SAI calculation by a maximum of 5.64%, whereas student assets count at 20%. Hope this helps with your planning!

This system is SUCH A JOKE!!! My brother has a fancy job and huge 401k but lives paycheck to paycheck with a massive mortgage, and gets more aid than I do as a careful saver with modest income who put money in regular accounts instead of retirement!!! It PUNISHES responsible people who save money the wrong way. The whole thing is DESIGNED to make middle class families pay MORE!!!

Thanks everyone for the helpful advice! I feel much more confident now about finishing our FAFSA. To summarize what I've learned: - NO to reporting 401k/retirement accounts - NO to reporting our primary home - YES to reporting checking/savings accounts - YES to reporting our rental property (net value) - YES to reporting investments outside retirement accounts - Consider timing of submission if large purchases are planned - CSS Profile for private schools is different and more detailed I'm going to get this wrapped up this weekend! Thanks again!

Just wanted to add one more thing that helped me when I was going through this last year - make sure you double-check your state's deadline too! Some states have earlier FAFSA deadlines than the federal one for state aid eligibility. I almost missed out on $2,000 in state grants because I didn't realize my state's deadline was March 1st while the federal deadline was much later. Each state is different, so definitely look up your specific state's requirements. Good luck with everything!