If your child is a high-school junior, make some fast moves now, since financial-aid officers will be scrutinizing your 2007 income. Sell any stocks that will produce big gains before the end of 2006, and take bonuses early.
If your child is a senior, start filling out the aid forms now. You can file your Free Application for Federal Student Aid form as early as Jan. 2 and put your child at the head of the line when aid is disbursed.
If your child is a high-school sophomore or younger, save what you can, but do it in a way that will not hurt his aid eligibility: the aid formulas really penalize kids with cash in their own names. Instead, invest in a 529 college savings plan or Coverdell education savings account (find both at savingforcollege.com) that is treated as a parent’s asset, not the child’s. Then sit back and see what happens first: your child matriculates or Washington comes through with that extra help.
