We increased our 529 contributions when we heard about the Roth rollover. For first kid I briefly looked at FAFSA and stopped when I saw they used 12% of parents taxable assets in "parents contribution".
There's some math later that reduces that 12% to IIRC 5.64%. That's the "not much" number the article probably refers to.
That 5.64%, if you're subject to asset reporting - which there are some ways to avoid - could make "stuffing" a 529 to take advantage of the 529->Roth rollover a non-starter. But if you just aren't sure how you're kids' college financial situation is going to turn out and might end up with some extra, this new law seems really well done to help with that issue.
https://www.collegedata.com/resources/pay-your-way/how-student-and-parent-assets-affect-your-financial-aid
WHAT'S COUNTED AS AN ASSET?
For purposes of the FAFSA, an asset is essentially any money that is readily available and includes but is not limited to:
Bank and brokerage accounts
Cash
...
Is there any need to continue if 5.64% of that is > expected college costs?
There can be. But it sounds like you want to simplify so I'll just mention several offhand and you can investigate more if you want to:
1. If you meet certain criteria, you can be exempt from asset reporting, so parental and student assets are completely ignored and FAFSA aid can be awarded. With the new FAFSA simplification rules, there are multiple paths to meet this criteria.
2. Some scholarships and grants which might have different rules from FAFSA might require the applicant to complete the FAFSA to be considered for the scholarship or grant.
3. There is other math - sorry, don't recall it offhand and it's changing anyway - that might create situations where aid might be awarded even if 5.64% of assets > expected college costs.
4. Most obviously, the FAFSA application is first typically completed in the fall/winter of the student's senior year at a point in time where expected college costs can't be known with certainty. (You can complete it later, of course, but some financial aid is limited and first-come first-served.)
Again, though, it does sound to me like you might simply not want to fill out the FAFSA for whatever reason(s). You don't think it's ethical for your family to accept aid, or you don't think it will work and it's a hassle to fill out, or you have financial privacy concerns. That's cool too.
