New FAFSA Favors Grandparent College Giving

Helping a grandchild obtain a college degree could be a lifelong gift, but grandparent giving has often required fiscal gymnastics to avoid reducing a student’s financial aid eligibility. That is changing with the 2024–2025 Free Application for Student Aid (FAFSA), which opens in December 2023. The changes apply to any gifts from grandparents, including distributions from grandparent-owned 529 plans, which offer tax-free growth when funds are used to pay a beneficiary’s qualified education expenses.



Distributions and Gifts No Longer Counted

Under the old rules, grandparent gifts and grandparent-owned 529 distributions were counted as untaxed student income and assessed at 50% when calculating student resources, which would typically reduce a student’s financial aid award. The new FAFSA will no longer include a question about gifts from grandparents and will draw student income information solely from the student’s tax return, which would not include gifts or 529 distributions.

This means that grandparents will be able to help with their grandchild’s college expenses without affecting the student’s eligibility for financial aid based on the FAFSA. Keep in mind, however, that grandparent gifts and 529 distributions will likely continue to be counted by the CSS Profile, an additional aid application typically used by private colleges when distributing their own institutional aid.


A Family Project

Here’s how the typical family paid for college during the 2022–2023 school year 
How typical family paid for college in 2022-2023: Parent income and savings: 40%; scholarships and grants: 29%; student borrowing: 11%; student income and savings: 10%; parent borrowing: 8%; relatives and friends: 2%
Source: Sallie Mae, 2023


The FAFSA uses a two-year “look-back” period for income, so the 2024–2025 FAFSA will be based on the student’s 2022 tax return. Thus, a grandparent gift or distribution in 2022 won’t affect the 2024–2025 FAFSA, and the same treatment will apply to gifts and distributions in 2023 and later years.

Consider the investment objectives, risks, charges, and expenses associated with 529 plans before investing. This information and more is available in the plan’s official statement and applicable prospectuses, including details about investment options, underlying investments, and the investment company; read it carefully before investing. Also consider whether your state offers a 529 plan that provides residents with favorable state tax benefits and other benefits, such as financial aid, scholarship funds, and protection from creditors. Generally, there are fees and expenses associated with participation in a 529 plan. There is also the risk that the investments may lose money or not perform well enough to cover college costs as anticipated. For withdrawals not used for higher-education expenses, earnings may be subject to taxation as ordinary income and a 10% federal tax penalty.

ENGLADE Insurance & Financial Services | Baton Rouge, LA

What is Financial
Peace of Mind?
Schedule a Consultation

A strong foundation is the key to creating long-term stability....

Here at ENGLADE Insurance & Financial Services, we focus on the client and what is in their best interest. We take a extensive approach to get to know the person and what are their goals before we make any recommendations. We collaborate with your trusted confidante to make sure everything is taken into consideration and nothing is left out.

We understand a sound financial strategy starts with a solid foundation. Life insurance is simply a piece of paper that says, "I love you." Our primary focus is to help our clients act on that love.

No matter where you are in life or how much preparation or thought you have or have not done, if you want to pursue your financial health, we would love to meet you.

Meet Our Team Schedule a Consultation

Meet Our Team

Matthew Englade

About Matthew

Angela Englade

About Angela

Jacob Ashford

About Jacob

Matthew Englade

Matt graduated in 2008 from Southeastern Louisiana with a bachelor's degree in business. He started his career in financial services, working as a staff member with Delahaye and Associates, where he eventually became a partner.

In 2022 he formed Englade Insurance and Financial Services, where his primary focus is serving his client’s best interest. “But even if you should suffer for what is right, you are blessed.” 1 Peter 3:14

Matt is a resident of Central, LA and enjoys spending time with his wife, Angela, and three children. He also enjoys coaching middle school basketball and giving back to his local church.

Jacob Ashford

Jacob is currently a student at Southeastern Louisiana University and is studying in the College of Business as a Marketing Major.

Jacob pursues his career by working with Matt and Angela in their mission to spread financial sustainability with their current and future clients. He also donates his time to the Southeastern's College of Business by participating in numerous career services for the city of Hammond.

Having two younger sisters, Jacob understands the importance of protecting family values and leading a path to a secure future.

Nathan graduated from Texas A&M University Class of 2006 with a degree in Agriculture Leadership & Development. Nathan has been in public service as a firefighter since 2008. In addition he and Katherine have started, operated, purchased, and sold multiple small business’. Through his experiences; Financial Services has been a lifelong pursuit for Nathan and he is excited to be a resource for people like you, your family, and your business.

Angela Englade

Angela graduated from Southeastern Louisiana University with a Bachelor of Science degree in Nursing. She worked as a Labor and Delivery nurse for 14 years. She decided to continue her love for caring for others through helping people obtain financial health and wellness.

She joined Englade Insurance and Financial Services to guide Matt's clients on becoming aware of potential roadblocks and achieve financial peace of mind. In her free time, she enjoys spending time with her family and exercising.

Along with Matthew, she volunteers many hours to local charities to give back to the community.

Eve is happily married to her best friend Rick since 2012. They enjoy recreational trips like hiking and camping, visiting the beaches in the Gulf of Mexico, and trips to Walt Disney World. They are active in their congregation, donating their time and effort to help run the Audio/Visual presentations for services. She is grateful for all God has given her and believes all the glory goes to Him.

Core Services

Map of Licensed States

Englade Process

Resources

Additional Resources coming soon!

Involvement

Community logo

Matt is a board member of CALEF and is involved committed to its long-term success. The mission of CALEF is to provide police, fire and EMS personnel with the safety equipment they need to serve and protect with excellence. We provide all-day rifle protection and other safety equipment to local law enforcement, fire and EMS personnel. CALEF believes that communities are safer and stronger when local law enforcement, fire and EMS personnel are properly equipped to do their job.

Community logo

Matt and Angela are active members of the church and school communities of St. Alphonsus Liguori Catholic Parish. Their mission is to form students in the Catholic Faith spiritually, academically, physically, and culturally in an environment of academic excellence. St. Alphonsus Liguori Catholic School is committed to providing a positive, faith-filled environment for children to learn. Our comprehensive curriculum is designed to promote academic excellence and the spiritual growth of our students, coupled with an appreciation of how service to others makes the world a better place. We strive to expand their potential to become leaders.

Client login

New York
Life

NYLife
Securities