A few weeks ago, I received a call from a mother in distress. This mother was filling out an FAFSA, which is a government application to apply for federal aid to help pay for college.

She was worried that she had too many assets, which would disqualify her from receiving grants and loans.

She wanted to know if she could sell some of her stock investments and use the proceeds to buy gold coins and bullion to keep in her safe at home.

Her hope was that she wouldn’t have to report her gold to the government, which would help her qualify for more aid.

The government was one step ahead. They require people to report these types of investments on the FAFSA. She was pretty disappointed and asked about the consequences if she failed to report these investments. I advised her against it.

While the government does require you to report certain assets and accounts, there are others that are not. If you or a loved one will be filling out a FAFSA in the future, keep reading.

One class of account that is free from reporting is retirement accounts. IRAs, 401(k)s, and 403bs, among others, are exempt.

Insurance policies are also exempt. Whole life insurance usually has a cash value or other investment type of account attached to the policy.

Annuities are also exempt from FAFSA reporting. Using insurance to qualify for aid can backfire because the fees on some of the insurance based products can be more than government based savings.

A 529 college saving plan is usually included as an asset when owned by the parent or child. Some people will retitle the 529 plan the name of a trusted grandparent, which will hide it from the FAFSA.

Home equity is free from reporting. Some people will use liquid assets to pay down mortgage debt and then refinance after to get that money back out.

Paying down a mortgage and then refinancing to get money back out can also backfire because there will be fees to refinance.

Under most circumstances, family or sole proprietor businesses are not counted as an asset for the FAFSA.

Many people do not own this type of business, but those who do can use many caveats of owning a business to shelter funds.

While there are things, you can do to help yourself qualify you need to evaluate savings before you go to extreme lengths.

I once knew a family who went to great lengths to be eligible for government aid. Their child ended up going to an inexpensive junior college. The amount they saved just wasn’t worth the effort.

Some of these strategies require time to set up. The further ahead you plan the better off you will be. For most parents, college planning should begin at birth.

Tom and John Mills are registered investment advisers and certified financial planners. Reach them at 254-0155, MillsWealth.com. Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Strategic Wealth Advisors Group (SWAG), a registered investment adviser.