Question 89 on the FAFSA asks about parents' net worth of current investments, capturing cash and brokerage holdings to determine expected family contribution. This detail helps colleges estimate how much your household can responsibly fund toward tuition and related expenses.
Understanding what counts and how to report accurately can reduce surprises in your financial aid package. The following sections break down definitions, common assets, and practical steps aligned with this question.
| Asset Type | Example | FAFSA Parent Reporting | Impact on EFC |
|---|---|---|---|
| Cash and Savings | Checking, savings, money market | Reported at current balance | Assessed at 5.64% |
| Taxable Brokerage Accounts | Stocks, bonds, mutual funds, ETFs | Reported at current market value | Assessed at 5.64% |
| 529 College Savings | Parent-owned plan balance | Reported as investment asset | Protracted assessment due to sheltering |
| Retirement Plans | 401(k), IRA, pension | Excluded from net worth | No direct impact |
Current Investments Defined for FAFSA Question 89
For Question 89, current investments include assets you could quickly convert to cash, such as bank accounts and securities. Retirement accounts and the primary home are specifically excluded, which helps narrow what you must report.
Keep values snapshot-specific, using the date printed on the application or the day you complete it. Market fluctuations can change reported numbers, so record balances consistently across families and submissions.
How to Value and Report Investment Accounts
Balance Aggregation
Add balances across all owner-controlled accounts on the reporting date. Include checking, savings, certificates of deposit, and taxable investment holdings to arrive at the net worth figure for Question 89.
Market Value for Securities
Use the fair market value, typically the closing price on the reporting date for publicly traded stocks and mutual funds. Private business valuations, art, or collectibles generally do not belong on this line.
Common Assets Included and Excluded
Knowing which assets count ensures accurate reporting and prevents aid reductions based on incomplete data. Align your documentation with federal methodology to streamline processing.
| Included Assets | Excluded Assets | Notes |
|---|---|---|
| Bank Checking and Savings | Primary residence equity | Report even if funds are modest |
| Taxable Brokerage | Retirement plans (401k, IRA) | Value based on current market price |
| 529 College Savings (parent-owned) | Small business value | Report as investment, assessed at reduced rate |
| Coverdell ESA balances | Life insurance cash value | Exclude if policy owner differs |
Practical Steps for Accurate Reporting
Gather account statements from the past few days to capture current balances. If multiple parents or stepparents own assets, consolidate according to household rules.
Double-check values against official year-end or month-end statements, and round to the nearest dollar. Consistency and precision reduce follow-up questions from financial aid offices.
FAQ
If I recently sold stocks and moved cash to savings, which value should I report?
Report the total of cash and the realized sale proceeds as of the application date, combining bank and brokerage balances under parents' net worth of current investments.
Do 529 plans held by grandparents count here?
No, grandparent-owned 529 plans are excluded from this question because they are not parent-owned assets for FAFSA purposes.
Should I include the loan balance on margin accounts?
No, net worth is based on asset values only; margin loan balances are liabilities and are not entered in this net worth calculation.
What if the market dropped right after I reported, changing values?
Aid offices typically rely on the snapshot you provide; significant changes next year will be captured during renewal adjustments, so report current values accurately.
Key Takeaways for Question 89
- Include cash, savings, and taxable investment balances as parents' net worth of current investments.
- Exclude retirement plans, primary home equity, and life insurance cash value.
- Use the reported market value on the application date for securities.
- Consolidate household accounts and verify balances against recent statements.
