FAFSA: Free Application for Federal Student Aid

You’ve heard about it, but like so many first-time applicants, you don’t want to do it.  Take it from this veteran parent:  you want to do this!  And they’ve made it easier in recent years, so read on and get ready.

I hear many folks in the middle class say things like, “Our household is not going to qualify for any aid, so why bother?”  While it’s true you may not qualify for financial aid at many of the state universities, the FAFSA is required to access most scholarships, even those that are not need-based.  The FAFSA is also used as the first step (followed by the CSS Profile) in creating the financial aid package awarded by private universities with large endowments, and it gives you the access you want to those lower rate federal student loans and on-campus work study programs so Junior can earn while he learns.

The FAFSA application needs to be completed around the time of the college application.  Since our #3 Child is applying Early Decision to her dream school (November 1 deadline), we just finished up the FAFSA yesterday after a 4-year hiatus between children.  I’m here to tell you that it has only become less painful in the last decade.  After you fill out lots of personal information about your child, the parents, and any step-parents in the household, you then need to input which schools should receive the info.  This list is limited to ten entries, but you can go back and revise the list to include different schools after the first submission has cleared the system.  FAFSA has a handy lookup tool for school information, so loading ten schools took less than ten minutes.

The application now links to a handy IRS lookup tool, alleviating some of the potential stress of entering the required tax return info.  Put in a few identifying pieces of info and the two federal systems are happy to talk to each other and make your life simpler.  However, I found out this year that my husband’s IRS record has been flagged due to a security breach and, therefore, this handy tool is not available to us.  So I drug out the 2017 tax records (yes, FAFSA now goes back two years from the date of when you will start school), input a few numbers from the 1040 and W-2s, and I was done.  Of note when doing the financial information, you do need to add up the approximate value of your assets NOT including retirement accounts or equity in your primary residence.  No documentation upload is required.  Just another instance where it pays to have all your accounts aggregated on one website.

Once you and your student sign the application and hit submit, your student will receive an email that has calculated your EFC (expected family contribution).  Like nearly every other family under the sun, you will gasp at this number and not know where they think that money is going to come from.  If nothing else, this may motivate your student to begin the scholarship applications in earnest, find a part-time job, learn more about the different federal and private loan options, and reevaluate just how much is feasible and reasonable to spend on college.  Remember, the EFC applies to the whole household, so two kids in college does not double your EFC.  And if those children are attending private colleges, their odds of getting assistance from the school’s general scholarship funds go up dramatically.

If you have questions about the college app process, how financial aid works, or how to best attack paying for college, schedule a free 30-minute call with me.  I am happy to share what I know!

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