Patience Can Be a Value
One way for grandparents to avoid hurting student aid eligibility is to wait awhile. The SECURE Act, passed in 2019, allows people to pay up to $10,000 loans per student using 529 plans. So if grandparents wait until after graduation, they can use 529 funds to pay some of the student’s loans.
Another way grandparents’ patience can pay off: wait until after the child is in college. Because the Free Application for Student Aid (FAFSA) looks at past years’ income, any tuition help after Jan. 1 of the student’s sophomore year will not affect aid for the final two years—assuming the student will graduate in four. Grandparents can avoid impacting aid eligibility by focusing their help on the second two years of school.
One caveat: the federal rules described here affect what families report on FAFSA. The CSS Financial Aid PROFILE form , administered by the College Board and used to determine eligibility for non-government aid, employs a different formula.