Vuefolio seminar for oracle owl sc may 13 2015

www.vuefolio.com

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SAVING and PAYING for COLLEGE COSTS

IMPACT

on FINANCIAL AID and your RETIREMENT

Oracle, Santa Clara

May 13, 2015

Oindrila Ray

[email protected]

Vuefolio is a SEC Registered Investment Adviser

Do not distribute without permission

mailto:[email protected]

www.vuefolio.com Do not distribute without permission

Vuefolio is a SEC Registered Investment Adviser

SAVING and PAYING for COLLEGE COSTS

IMPACT

on FINANCIAL AID and your RETIREMENT

Oracle, Santa Clara

May 13, 2015

Oindrila Ray [email protected]

mailto:[email protected]

www.vuefolio.com

Disclaimers


• All materials, graphs and analysis are solely for educational purposes.

• This is not a pitch for any investment product.

• Please do not consider this as financial or investment advice.

• We are not tax lawyers or accountants.

• We do not represent nor endorse any college, educational institution or any funds that may be mentioned in the presentation.


As PARENTS,

we try to SUPPORT our CHILD’s

ASPIRATIONS and EFFORTS


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The College Pyramid


Other

Private

Colleges

Need/Merit Aid Acceptance Rates

Need Sensitivity

Alumni Network

College Rankings

Initial Placement

Elite

Private Colleges

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Public

Flagship Public

Private

Elite Private

20,000 30,000 40,000 50,000 60,000 70,000 80,000

Out-of-State …

Cost of Attendance Every Year


UCs $34,000

CalStates $22,000


NET PRICE

“personalized prices”

Families pay

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Your Price Tag for College


Family Income # of kids attending college

Non Retirement Assets

Financial Aid available

Your “Actual Cost of College” or NET PRICE depends on:

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Ex: Harvard vs. UC Berkeley estimated 2014-15 cost


Net Cost: Harvard

Aid: Harvard

Net Cost: UC Berkeley

Aid: UC Berkeley

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000 E

sti

mate

d C

ost/

Aid

Family Annual Income

Typical California family with one child in college.

Besides income, the cost of attendance will also depend upon the asset level of the family.

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Paying for NET PRICE


Source: Sallie Mae “How America pays for College 2014

PARENTS

FINANCIAL AID

STUDENT LOANS


FINANCIAL AID: NEED and MERIT

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Financial Aid


Need based Aid

• Income

• Assets (non retirement assets)

• Family profile

• Home equity (most private colleges)

Merit Aid

• GPA

• Leadership

• Sports

• Extracurricular

• Diversity

• Others…

Athletic Scholarships

• NCAA Div I & II

• Few sports

• Low Odds: 2% of HS seniors

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Financial Aid


Federal Grants:

Pell Grants

State Grants:

Cal Grants Institutional Aid

Federal Student Loans

Sources of Need based Aid


College vs Financial Aid

Source: College Board “Trends in Student Aid” 2014

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First Year Merit Aid: Private Colleges


Carnegie-Mellon, 40%

Boston College, 32%

NYU, 32%

Wellesley, 29%

USC, 20%

Harvey Mudd, 19%

Johns Hopkins, 17%

Rice, 17%

Georgetown, 17%

Northwestern, 15%

Vanderbilt, 13%

Average Merit Aid Cost of Attendance College, Admission Rate

MERIT AID: Only 10-20% of student population

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Merit Aid : Private Colleges


Source: College Board “Trends in Student Aid” 2014

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How can families in Bay Area get Financial Aid?


• Demonstrate need based on income

• Multiple kids in college at the same time

• Private Colleges which offer Merit Aid

• Out of State Public Colleges with Merit Aid

• UC: Regent’s scholarship. CalState: Trustee’s award etc

• Many colleges will send offers even before application based on SAT and other

scores

• External Scholarships


PAYING

for

COLLEGE

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Savings

Bay Area Parents Pay for College…

Student

&

Other

Loans Relatives

Savings

Savings Income

Savings

Student Loans

Income

Income

Loans,

Retire-

ment

Home Equity

Student Loans

Income

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Key to paying for college


PAY FOR COLLEGE

WITHOUT HURTING

your RETIREMENT or FINANCIAL AID

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The strategic way to pay for college


Financial Aid Eligibility

Aid beyond first year

Tax efficient Investments

Sufficient Income

Student Loans

Siblings Retirement

Savings status

Home Equity

Parental Loan Impact

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Paying for College


529 Plans Investment/

Savings Accounts

Custodial Accounts

ESPP

Roth IRA

Federal Student Loans

Parent Plus Loans

Home Equity Loan/ Line of Credit

Private Education Loans

Loans against 401k accounts

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Worst way to pay for college


Dipping into your 401k, IRA,

or other retirement savings

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Paying for College: Roth IRA


Pros

Penalty free for education

Assets not counted on financial aid forms.

Contribution amount can be withdrawn tax free

Cons

Pay income tax on the earnings if withdrawing before 59½ yrs

Withdrawal counted as income on next years financial aid form

Using up your retirement money

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Paying for College: 529 Plans


Pros

Earnings grow tax free

Only 5.64% of assets are counted against aid

Not counted as income on next years aid forms

Cons

Non education purposes, 10% penalty and tax on

earnings

Cannot claim Education tax credits

Not all plans are the same!

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Late to the game?


How much

college will cost

you: NET PRICE

Any chance of

FINANCIAL AID?

Get your 529 tax

breaks

Status of non

retirement

investments

Withdrawal

reduce financial

aid? Be

defensive

Loans vs choice

of college or both


College

Metrics/

Statistics

Family College

Savings

Smart Financial Planning for College

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Smart Financial Planning for College

+

Hyper Local Cohorts

Your Plan


Online Resources

Information on saving and paying:

https://www.vuefolio.com/

https://www.edvisors.com/

Information on private loans:

https://www.sofi.com/

https://www.tuition.io/

https://www.edvisors.com/

Information on net price/aid/loans:

http://www.ed.gov/

https://fafsa.ed.gov/

https://studentaid.ed.gov/

http://www.cde.ca.gov/

https://www.collegeboard.org/

https://collegeabacus.org/

https://www.meritaid.com/

https://www.scholarships.com/


Thank you for your time.

To learn more, check out our website

https://www.vuefolio.com

Disclaimer: Vuefolio does not render legal, accounting, or tax advice. This presentation is solely for informational purposes and is not a

solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Vuefolio is not responsible for any

college costs, financial aid, student or any other kinds of loans, investment performance of the 529 state plans. Any data quoted

represents historical information. Any past performance quoted is no guarantee of future results. Vuefolio is a SEC registered Investment

Adviser.

Vuefolio seminar for oracle owl sc may 13 2015

Economy & Finance

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