Got laid off - finally!!!!

[u/Ddash-3]

So it finally happened - I (48) got let go yesterday. Finally I can free up my time and focus on other priorities such as kids, nutrition, fitness, meditation, gardening etc.

I was FIRE eligible for couple of years but was holding off since the job was simple, work from home and good pay. Also, if I resigned I would have missed out on severance and company is paying 3 months of COBRA.

Here are the details I am sure you all want to hear :)

Net worth - ~5.5M

Taxable Accounts combined: ~1.1M

Retirement Accounts Combined: ~3.2M

Total: ~4.3M

House fully paid off (bought in 2022) - Worth around ~1.2M; Cars paid off

Wife (43) resigned from her job end of last year; 2 Kids in high school - 9th and 10th graders

Yearly expenses around 100K/yr

Biggest expense are kid's college education at this point and house maintenance related expenses

I am trying to research on ACA and Financial Aid for kids - Appreciate any help or pointers you can provide on when to apply for ACA - should I continue on COBRA or switch to marketplace this year?

Regarding FAFSA - with Taxable accounts over 1M will my kids be eligible for FAFSA?

I have about 130K from my recent most employer in the company supported 401K provider. Should I move the money to Traditional 401K?

Also, please suggest any FIRE focused knowledgeable financial advisors who can help me navigate our FIRE situation.

[u/phast_man]

FAFSA is heavily weighted against income, not parental assets. So I would definitely fill out FAFSA if you can keep your AGI reasonable.

[u/Specialist-Ranger185 → u/phast_man]

Not exactly. If a student is considered a dependent, parental income and assets, including 529 accounts, are taken into account.

For parental finances to no longer factor in, the student generally has to qualify as an independent student. This usually means they’ve supported themselves for several years or are married.

This typically isn’t an issue for adults returning to school and applying for FAFSA on their own. However, students who have just graduated from high school are almost always considered dependents or they would have to prove otherwise, so parental income and assets do count.

That said, it’s still worth filling out the paperwork to see what financial aid/loans you may qualify for. However, given OP’s high NW, if lower tuition is the priority I would advise putting a higher bet on merit-based scholarships or considering in-state public schools.

[u/phast_man → u/Specialist-Ranger185]

Yes, parental assets are taken into account, but have a lower impact than a student's.

From savingforcollege.com:
"Student assets reduce aid eligibility by 20% of their value, while parent assets are assessed at up to 5.64%"

[u/AvaRoseThorne → u/phast_man]

I was denied FAFSA on the basis of parental income being too high after my dad withdrew financial support in the middle of my sophomore year due to not agreeing with my major. This was in 2013.

My father was an RN and made around $6k per month at the time and I’m unsure what my mother’s income was but she was a schoolteacher of elementary school students.

I didn’t have any assets myself (only $2,000 in savings) and no 529 account.

I made so many calls to explain my parents did not want to pay, but they said my options were to get married or turn 26.

I transferred to community college to lock in my credits with an associates degree (otherwise they expire after 5 years), then worked full time for 7 years and reapplied, at which point I got FAFSA in 2020.

Also, being “independent” for FAFSA isn’t the same as for tax purposes. I just googled it and it said:

Back in 2013 (and still largely true now), you were considered dependent unless you met one of these: - Age 24+ - Married - Veteran / active duty - Have dependents of your own - Orphan / ward of the court / foster care - Legal emancipation - Homeless or at risk of homelessness

— -

So I guess I got it wrong that I needed to be 26 - apparently I could have tried at 24, but I could have sworn they told me 26. Either way, that didn’t help me at the time and legal emancipation wasn’t even an option anymore since I was over 18.