Expert: David Disraeli - 8/13/2009

Question
I live in Europe for work and only spend a month or two stateside each year. This means that I own no home (we rent in Europe and also for our stays in the USA). Thus all of our "home money" is held in bank accounts and mutual funds which, I'm learning, is NOT ideal for the Fafsa.
We are not comfortable in buying a home in Europe but would like to have one in the USA for our time at home, for my parents to use, for our eventual job change/retirement, etc. However, since we rent in Europe and would own a home in the USA, would this be considered an investment rather than our principle home?
I also saw on the Fafsa literature a comment referring to investments in this way, “Investments do not include the home the student lives in”. If my daughter lives in my home w/my parents, does that qualify the home as her living place and not our investment? Would she have to be there at the time we fill out the Fafsa (January?) or just that summer before going to a US college.
Hope this isn't too complicated. It is for me! ;-)
Thanks so much!
Michael

Answer
You are correct Michael - this is complicated.  I honestly don't know when a "residence" would no longer be considered a residence.  There are 6 components to FASFA parents' income, parents' assets, child's income, child's assets - period.  Normally the residence is not counted.  My hunch is your income may preclude you from receiving aid anyway.  I haven't addressed foreign earned income but I don't know why it would be treated any differently.  

There is an answer, but it would require a formal engagement of some sort.  Also all FASFA information for income is based on the previous tax year, assets are the day you fill out the form. If I have more specifics on your income, assets, and the type of school your daughter wants to attend I can tell you whether its worth going through a professional evaluation.  Of course all I know is your first name so you are anonymous to me.  Feel free to look at my website or email me back at david@lifepln.com

Regards,

David Disraeli CFP

www.debtfreegraduate.net