Three Ways to Lose Aid Money Without Doing Anything Wrong

Not every expensive mistake feels like a mistake. Some of them feel like doing the paperwork properly.

Here are three that cost families real money every single year, and none of them involve doing anything you'd recognize as wrong at the time.

One. Putting money in the wrong column.

I've written about this before and I'll keep writing about it: assets in your kid's name are assessed far more harshly than assets in yours.

The mistake here isn't strategic, it's clerical. On the forms, parent assets and student assets are separate questions, and it is genuinely easy to put a number in the wrong one when you're forty minutes into a long form on a weeknight.

That slip can cost thousands of dollars a year. Slow down at those two boxes.

Two. Reporting things that aren't supposed to be there.

If you include your retirement accounts or your primary residence in your net worth on the FAFSA, you have just volunteered money out of your own pocket.

They don't belong there. Nobody is trying to trick you. You are simply answering a question that wasn't asked, and every dollar you add reduces what you're eligible for.

This is the same species of error as the business valuation problem I wrote about last week. Real-world common sense says a house and a retirement account are obviously part of what you're worth. The formula says otherwise, and the formula is what's being applied.

Answer the question that's on the form. Not the one you think it means.

Three. Missing a deadline you didn't know existed.

This one makes me want to put my head through a wall, because it's pure lost money for zero reason.

Every college has its own financial aid priority deadline. Every one. They differ, sometimes by weeks.

And they are on a completely separate track from the admissions deadlines. Early decision, early action, regular decision, those are one calendar. Financial aid priority dates are another. Families who are carefully managing the first calendar routinely have no idea the second one exists.

Miss a priority deadline and money that was there for you goes to a family that filed on time. The college is not going to chase you about it.

Here's what Pearl does for her clients, and you can do it yourself tonight.

Take every school on the list, all fifteen or twenty of them, and find the earliest financial aid deadline across the whole set. Then file everything, to every school, by that date.

Don't dribble them out one at a time as each deadline approaches. That's how one gets forgotten. Do them all at once, get it off your plate, and never think about it again.

One more thing. Filing can trigger follow up questions, and those arrive by email, often to your kid's address. Somebody has to actually be reading that inbox. A clarifying question nobody answers becomes a file that quietly stops moving.

None of these three are clever. They're just the difference between the money you got and the money you were entitled to.

Onward.

-Andy "Answer the Question That's Asked" Lockwood

P.S. There's a version of this checklist that runs about two pages, and going through it takes an evening once. Families inside the Lockwood Inner Circle get it along with everything else we use with our private 1:1 college advisory clients. A dollar gets you in: lockwoodinnercircle.com