3 Tips for Getting the Most Aid (i.e. Money) From the FAFSA
The average cost of college is $24,317 for public schools and $39,020 for private not-for-profit schools. And that’s just for one year. That means four years of college could cost you up to $156,080.
With such a hefty price tag attached to your education, you’ll want to do everything you can to offset costs. That includes applying for scholarships and financial aid.
The king of all financial aid forms is the FAFSA, otherwise known as the Free Application for Federal Student Aid.
What Is the FAFSA?
The FAFSA is used to calculate your family’s Expected Family Contribution (EFC), or the amount of money the federal/state government believes your family can afford to contribute to tuition that year.
Based on your family’s EFC, you may qualify for federal grants, subsidized and unsubsidized loans, and/or work study programs. Colleges also use the FAFSA to calculate how much they’ll contribute to your financial aid package.
You must fill out the FAFSA each year you’re in school. Filling it out your freshman year will not count toward receiving aid sophomore, junior, or senior year.
PSA: Everyone should file a FAFSA.
Don’t think your family will qualify for financial aid? Fill out a FAFSA anyway.
In many cases, the FAFSA is required. Additionally, income isn’t the only factor taken into consideration. The government and schools also look at the size of your family, your year in school, and more.
Sometimes, families unexpectedly qualify for aid. At expensive private schools, aid is awarded even to families with reasonably high incomes — sometimes as high as $200,000.
And the FAFSA automatically qualifies you for low-interest and forgivable federal student loans, which can be accepted or rejected (and are at least worth considering).
Some colleges even use FAFSA information as a deciding factor for students who are on the borderline for merit-based scholarships. In fact, most colleges require students to apply for need-based aid to be considered for merit-based awards.
So, no matter how much money your family has, filling out the FAFSA is an absolute must.
How to Complete a FAFSA: The Basics
You and a parent or guardian will have to separately apply for an FSA ID. That may sound complicated, but it’s a quick and painless process.
Next, you’ll fill out the FAFSA form online or on paper. Completing the form online is easier and results in faster processing.
To complete the FAFSA, you’ll need:
- Social Security number
- Federal income tax returns, W-2s, and other records of money earned (NOTE: The new IRS Data Retrieval Tool can make this part easier.)
- Bank statements and records of investments
- Records of untaxed income
- Alien Registration Number (if not a citizen)
- Your FSA ID
If you’re a dependent, you’ll need all the above information for a parent or guardian too.
After You Submit the FAFSA
Once you’ve submitted the form, the U.S. Department of Education will process your form within 3-5 days (7-10 if you submitted on paper).
When your FAFSA is processed, you’ll receive a copy of your Student Aid Report (SAR). The SAR summarizes the information you provided and lists your Expected Family Contribution. (Remember, your EFC determines your eligibility for a Federal Pell Grant and is used by colleges to assess your eligibility for other federal or nonfederal aid.)
Look over your SAR and make sure all the information is correct. If not, submit corrections as soon as possible.
Once your FAFSA is processed by Federal Student Aid, the SAR will be sent to the colleges you listed on your FAFSA. These colleges will create your financial aid/award package and are responsible for disbursing any aid that you receive.
3 Tips for Getting the Most Aid (i.e. Money) From the FAFSA
Now that you know the basics of the FAFSA process, here are a few essential pieces of information to keep in mind.
1. It pays to file early (literally).
The earliest date to submit your FAFSA is October 1. To maximize your chances of receiving aid, submit your form as close to October 1 as possible.
Aid is often awarded in the order in which forms are received, and unfortunately, financial aid isn’t unlimited. If you submit your information at the last minute to a school with a first come, first served FAFSA process, it could cost you.
Apply for your FSA ID in advance and gather all necessary documents. Plan with your parent/guardian to complete the application in the first or second week of October. That way, you’ll be ready to submit as soon as the FAFSA window opens.
The final deadline is typically June 30. Think about how many applications for aid are probably received between October 1 and June 30, and do your best to ensure your name is near the top of the list.
2. Be strategic in reporting your assets.
It’s important to be both informed and strategic when completing your FAFSA. First, you should know that the following types of assets are not considered reportable:
- Retirement accounts
- Life insurance policies
- Home equity
- Personal possessions
Factoring unnecessary assets into your FAFSA could reduce your aid package, so avoid listing the assets above.
At the same time, don’t lie in hopes of receiving more aid. Penalties for lying on the FAFSA include fines up to $20,000 and up to five years of jail time, plus paying back the aid that was fraudulently received.
So, don’t report any assets that aren’t required, and be truthful — lying on the FAFSA is not worth it.
Another helpful piece of info is that the FAFSA counts student assets at a higher rate than parent assets. Parental assets are assessed up to 5.64%, while student assets are assessed up to 20%.
Basically, $1,000 in your name decreases your need-based eligibility by $200. $1,000 in your parent’s name decreases your need-based eligibility by just $56.40.
If you have college savings in your name, it’s a good idea to go ahead and purchase some of the supplies you’ll need for college before completing the FAFSA. Important supplies could include a laptop, furniture for your dorm, storage containers, sheets and a comforter, and so on.
3. Appeal your award, if needed.
If your financial aid award doesn’t cover your college costs quite enough, you can appeal.
To do this, call the financial aid office to find the main point of contact for all appeals. Then, craft a concise but thorough letter to the contact person.
Be sure to include all relevant details — they won’t know about your pressing circumstances unless you tell them. To improve your case, provide documentation and other written proof of your current situation. Providing relevant details in thorough fashion will improve your chances of a better award letter.
Appeals aren’t always successful, but they’re worth it. After all, you have nothing to lose.
One final word of advice: If your family’s circumstances change after submitting the FAFSA, be sure to let the financial aid office know. For instance, if one parent loses a job, your aid amount will need to be adjusted.
Experts also suggest informing your school about situations that can’t be reported on a FAFSA, such as medical expenses, divorce, or death in the family.
Final Thoughts: 3 Tips for Getting the Most Aid (i.e. Money) From the FAFSA
It’s no secret that college is expensive. But there are many resources available to make education more affordable for students and their families.
Your ticket to many of these resources is the FAFSA, so don’t neglect to submit it, no matter how much money your family earns.
For best results, remember to do the following:
- Get your FSA ID and documents ready, then file as close to October 1 as possible.
- Don’t report unnecessary assets like retirement accounts, home equity, or personal possessions.
- Be truthful!
- If you have college savings in your name, buy college supplies before submitting your FAFSA.
- Update/inform your college about circumstances like divorce, death in the family, loss of a job, or medical expenses.
Keep these tips in mind, and you’ll ensure you get your fair share of financial aid.
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