529 plans and student loans for parent

[Anonymous]

Hi there. Occasional lurker, first time poster. I have a question about how 529 plans for my kids are factored into student loan eligibility if I want go back to school.

My husband and I have been putting money into 529 plans for our two kids. The money "belongs" to the parents, and the kids are identified as the beneficiaries of the plans. One of the plans is owned by me, with my daughter as the beneficiary.

now I'm thinking about going back to school. I'd like to preserve the money my daughter's 529, but since the money is technically mine, since I'm the account owner, am I going to be expected to use this money before I can qualify for student loans? I'm thinking about the federal loans (either subsidized or unsubsidized), because I'm assuming that a private student loan lender won't be as concerned. I know there's other factors that might disqualify me from federal loans, like income and assets, but I'm most interested in specifically how 529 plans for kids would be viewed. Thanks.

[Tazman81]

Well, I hope that someone else can chime in that might know a bit more about this, but in simple, yes, this will be counted as part of your assets because you are the owner of the account.  So, when you complete the FAFSA, you will need to list down the current value of the 529 Plan.  Normally the government counts abut 20% of assets of a student as "what they can afford to pay toward their college".  I do however remember seeing somewhere that for 529 Plans this may have changed and only about 6% of it is counted as an asset.  (Don't quote me on that one though).