College Financing: Mastering FASFA, 529s & Essential Planning Tips with John Hupalo

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FAFSA? EFC? SAI? What does all this mean? College planning is complicated and overwhelming for both the student and the parent. There should be an easy button to plan for college. 

In this episode of the Stuff About Money podcast, Erik Garcia, CFP®, has a candid discussion with John Hupalo (4-time guest on the show) on navigating the FASFA maze. From demystifying FASFA responsibilities to understanding asset impacts on aid eligibility, get expert insights into college planning essentials. They discuss strategies to pay for college using needs-based methods as well as merit-based methods. This is a must-listen if you have a student in the 8th grade all the way to college age.

Episode Highlights:

  • John mentions that there is still work to be done in expanding and improving the prepaid college savings program. (2:16)
  • John discusses how having a conversation about college affordability and financial fit early on in a student’s high school years is crucial to making informed decisions and potentially reducing the amount of debt required for higher education. (6:53)
  • John explains that students must fill out the FAFSA form as it determines their eligibility for work-study, Pell grants, and federal student loans, and using online tools like the financial aid calculator can help estimate their Student Aid Index. (14:28)
  • John shares that it is important to understand the implications of the IRS having access to your financial information for automatic uploading into forms. (25:58)
  • John discusses improvements in the treatment of 529 plans for financial aid, including the removal of penalties for draining the account and the inclusion of grandparent 529 plans. (29:42)
  • John mentions that the recent changes to the 529 account program allow for greater flexibility in using the funds for education, including private and public schools, student loans, apprenticeships, and even rolling over into Roth IRAs. (44:28)
  • John believes that the key to planning for your child’s education is to be realistic about your financial situation and not sacrifice your retirement savings to pay for college. (47:18)

Key Quotes:

  • “The college planning process does not start at senior year. It really starts freshman year for students.” – John Hupalo
  • “Student loans should be the last resort, not the first option to pay for college.” – John Hupalo
  • “Be realistic in your college planning. Avoid compromising your retirement savings to fund your child’s education.” – John Hupalo

Resources Mentioned:

About Erik Garcia

Hi there, I'm Erik. How you manage your money and other resources impacts practically every aspect of your life. I help individuals and families invest plan for a more secure and predictable financial future. Thanks for taking time on my site!

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