11 Things You Need to Know About the FAFSA
Jan 8, 2015 1:54:00 PM
The time for high school seniors to apply for college financial aid is now, if you haven't done so already. Most students will receive at least some financial aid — either need- or merit-based — so it’s to your benefit to apply, even if you don’t think you qualify.
What You Need to Know About the FAFSA
The mother of all financial aid forms is the FAFSA, or the Free Application for Federal Student Aid. The earliest you can file the FAFSA — the “starting block” in the financial aid race — is January 1. The following tips will help you get ready.
1. It’s free!
The FAFSA is offered by the Federal Student Aid office in the U.S. Department of Education and can be found at www.fafsa.ed.gov. There is no charge for using the form, and it is available to all regardless of socioeconomic status. Don’t get lured in by unethical companies that charge you to complete the form.
2. It’s required for almost all college aid.
The FAFSA was primarily designed for applying to nine different Federal programs offering grants, loans, and work-study funds. States and colleges also use the information provided in the FAFSA to award aid. Students cannot qualify for the vast majority of available financial aid without it.
Be mindful that your student’s college or state may require other financial aid forms in addition to the FAFSA. This is also true of many scholarships funded by businesses and private organizations. Be sure to read the application directions carefully, and submit all the information required.
3. Many types of financial aid are awarded on a first-come, first-served basis.
Most aid is awarded to early comers until the money runs out, so it is crucial to apply as early as possible. The sooner your student files the FAFSA, the closer he or she will be to the “head of the financial aid line.” So apply as soon as possible, if you haven't done so already.
4. The FAFSA is intended for the college-bound student.
The FAFSA is filed in the name of the student, not the parent. In most cases, it’s the student who will ultimately be paying back any student loans and who will have to maintain eligibility for any scholarships received. Your teen can begin taking responsibility for his or her own financial future by completing the FAFSA (with your help, of course, if your student is a dependent). Filling out the FAFSA form is a terrific conversation starter about what college costs are realistic for your family.
5. “Aid” doesn’t necessarily mean free money.
The form is free, but the aid you receive may not be. The FAFSA is used to apply for the following types of assistance:
- Federal, state, and private bank loans (subsidized and unsubsidized)
- Tuition discounts/waivers
- Deferred interest/payments and other types of payment plans
- Work-study funds
- Scholarships and more
6. There’s a short cut.
The idea of spending even more time than usual looking at tax forms may make you want to put off filling out the FAFSA for as long as possible. Luckily, the FAFSA website provides a handy shortcut: the IRS Data Retrieval Tool (DRT). The DRT will automatically retrieve much of your student’s and your own tax information and enter it into the aid application for you.
7. You don’t need to wait till you’ve filed your taxes.
You and your student can estimate your 2014 taxes based upon your 2013 returns. Simply indicate that the numbers given are estimates and that you will be filing your taxes. If you file your income taxes electronically, it’s easy to update the FAFSA using the DRS tool mentioned above. The update is also submitted to all of the institutions relying upon your FAFSA.
8. You can make corrections later.
After your student has submitted the FAFSA, it’s still possible to correct an error or update your family’s financial situation. Your student can also add or remove colleges receiving the data and correct any field other than a Social Security Number (SSN).
9. The process is easier when you’re prepared.
To help the process go smoothly, your student will need to have the following items available when filing the FAFSA:
- Social Security Number (SSN)
- Alien Registration Number (if not a U.S. citizen)
- W-2s and other records of earned income
- Most recent federal income tax returns
- Most recent bank statements and investment records
- A Federal Student Aid PIN, if your student doesn’t already have one (Go to www.pin.ed.gov.)
If the student is your dependent, then you will need to provide most of the above info as well.
10. Schools need to know about any financial hardships.
If your student or family faces financial challenges not represented by information on the FAFSA, let colleges know. Is your income for the year artificially inflated for some reason? Has an illness in your family resulted in high medical bills? Are you expecting your income to be dramatically reduced during the coming year? Situations like these warrant a letter to the schools your student is applying to. If schools are aware of your situation, they can alter your Expected Family Contribution (EFC) to better reflect your ability to pay.
11. You have to resubmit each school year.
The FAFSA and other financial aid forms must be resubmitted annually — and on time — even if your student receives a four-year award. Failure to fill out the FAFSA for each school year can result in a lost award.
Each college and university has its own deadline for receiving financial aid applications, as does each state, and all these dates may be different. Read the application requirements for each college carefully, and find out about state deadlines at https://fafsa.ed.gov/deadlines.htm.