(Business 2.0) – It was bad enough when the Nasdaq tanked and obliterated your kid's college fund. So why did colleges have to compound the injury by jacking up tuition?

They say they're suffering for the same reasons you are, since their endowments, too, were tied to the markets. That explains why, according to the College Board, private colleges boosted tuition an average of 5.8 percent this year to $18,273. (Though it's funny how, when the bulls ran on Wall Street, tuitions still rose.) A year at Harvard now costs just shy of $36,000. Meanwhile, public schools pushed up their rates by an average of 9.6 percent to $4,081; the in-state price for top-ranked University of Michigan is $13,900.

Academic officialdom hastens to point out that aid has doubled during the past decade to about $90 billion a year. But these days, 57 percent of aid is in the form of loans. Colleges give away very little of their own money--it accounts for less than 20 percent of all aid. How do you get more? The trick is in learning how to tinker with the financial aid process. The odds will never be in your favor, but these tips may help level the playing field.

For starters, bear in mind the curious unwritten rule of finer financial aid departments everywhere: Savers are suckers. Colleges have always awarded financial aid to the grasshoppers, not the ants. So the trick for parents is to boost their chances for aid by taking steps--all legal--to appear to have less than they do. "Parents can still pay for college--if they're creative," says Kalman Chany, author of Paying for College Without Going Broke. Here's how to think like a financial aid Picasso.

1 DO THE PAPERWORK PROMPTLY. The most important step is filling out the Free Application for Federal Student Aid (FAFSA). Colleges use the six-page form (available at www.fafsa. ed.gov) to determine the amount your family should contribute to college costs--the so-called EFC, or expected family contribution. Even if you think you're too rich, go ahead and complete the form. You have to get this document to schools by June 30, but you can send it in as early as Jan 1. There's no advantage to waiting until the last minute. Why? Financial aid officers are known to make mistakes when they're rushed, and with money running low, it's unlikely that those mistakes will be in your favor.

2 GET RID OF YOUR KID'S SAVINGS ACCOUNTS. While this advice may run counter to conventional wisdom, keep in mind that your child's savings is actually assessed at a higher level than yours. Colleges count as much as 35 percent of your kid's assets toward the EFC, compared with a maximum 5.65 percent of your savings. And here's a child-accounting bonus tip: File separate income tax returns for your other children, so their income doesn't affect your aid picture.

3 SHRINK LINE 35. Aid officers typically don't count money in retirement accounts, so it makes sense to sock away as much as possible. There's another reason to max out your 401(k) contributions: Financial aid officers focus on Line 35 of IRS Form 1040--your adjusted gross income--beginning with the year during which your child becomes a high school senior. That's how they estimate what you can pay. Squirreling away pretax dollars is probably the best tool you have to reduce that number. If you can, it's also a good idea to defer any bonuses as long as possible.

4 MAKE YOUR JOB WORK FOR YOU. You can trim a little more by taking advantage of plans that extract pretax dollars to pay for medical expenses or commuting. People who have significant business-related expenses might consider taking a pay cut in exchange for reimbursements of equal value. For example, you can get your boss to buy you a $2,000 laptop, and accept $2,000 less in salary this year. Your income will drop, but your cash flow won't suffer--and you might win more financial aid.

5 ROLLING OVER HURTS. Converting a traditional IRA to a Roth IRA, which allows you to withdraw money tax-free during retirement, boosts your income by the amount in the account. So do it before the year your child becomes a high school senior or wait until after Jan. 1 of his or her junior year in college. And, of course, postpone large capital gains as long as you can. You can avoid declaring interest income on savings bonds until you cash them in--so don't do it before the second term of your child's third year of college. And here's something you might not have considered: Put off large charitable contributions, which reduce your aid eligibility.

6 START TALKING. What happens if the universities lowball you? (And they probably will.) Since colleges can't take back an offer of admission, there's no harm in negotiating. Tell them about changes in your financial picture, like a job loss or pay cut, a deadbeat divorced dad the school assumed was chipping in, or obligations such as support for elderly parents or big medical bills. Since the only leverage you have is that the school wants your child and fears that another university will steal him or her away, it makes sense to play on that fear.

If all else fails, keep your chin up. You can always remind the kids that Bill Gates and Larry Ellison never needed college degrees. --CLINT WILLIS (ADDITIONAL REPORTING BY TAYLOR SMITH)