13. An Inadvertent (mis)Use of an Annuity
Hey- these things are like water balloons. 'Ya squeeze one end and who knows what may pop (burst) out of the other end?
In this video we look at the most rudimentary (aka short-sighted) use of a non-qualified annuity to lower an EFC. This well-worn ‘strategy’ does (by formula) increase eligibility for need-based Federal financial aid by removing an asset from the EFC calculation.
Just be aware that creating an annuity that subsequently may need to be used to pay for college in the short-term will change its disbursements to 'income'… and likely being more costly. We look at what happens when you try to get water out of this balloon.
Hey (part deux)- on the upside, after all the college years, we're all likely to be broke anyway...