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What Is a FAFSA? Everything You Should Know About Student Aid

FAFSA - Everything You Should Know About Student Aid

Tuition costs in the U.S. have increased at an alarming rate over the past decade. Between 2008 and 2018, the average yearly cost to attend a private college has gone up 25% while public university rates have surged 29%. This has made the FAFSA program more important than ever for people want to earn a degree.

Federal Student Aid is one of the many ways students can make tuition costs more manageable. Every year, the U.S. Department of Education gives out over $122.4 billion in federal grants, loans and work-study funds. Almost 13 million students use this money to help pay for college. To potentially get some of those funds, all you have to do is complete a free application.

What is a FAFSA and why is it so important?

FAFSA stands for Free Application for Federal Student Aid. Just as it sounds, this is a form that you fill out and use to apply for financial aid disbursement. It’s the government’s way of determining who needs help paying for college. Federal financial aid can either be awarded through grants, borrowed through student loans or earned through work-study programs.

Since FAFSAs are free, every student planning on attending college should apply. It’s the most important document when it comes to getting financial assistance. If you don’t file, you won’t get any help from the government. Despite this, millions of dollars are left unclaimed every year by students who neglected to complete the process.

Here’s why everyone should apply:

How does the program work?

Administered by the Department of Education, the FAFSA application is used to assess your family’s financial standing. You can submit it online, through the myStudentAid app or by printing and mailing a physical copy. The online method, which involves creating an FSA ID to access your account, is the most convenient.

After your application is processed, you’ll get a Student Aid Report(SAR) that details your Expected Family Contribution(EFC). The results are then passed on to your school’s financial student aid office. Your EFC number is not how much your family must pay; rather, it’s what your college will use to determine your financial aid eligibility.

What kinds of questions are included in a FAFSA?

With over 100 fields to fill out, the application document can seem pretty daunting and time-consuming. However, many of those are pretty straightforward questions, such as your name, address and date of birth. Things get a little more complicated further into the form when you have to provide information about your taxes, income and residency status. Green Card holders and U.S. citizens are eligible for aid. Even if you don’t fall into either of those categories, it’s worth completing the form if you have a Social Security number; you could be eligible for private institutional financial student aid packages and state aid.

If you’re a FAFSA dependent student, you’ll also need to answer some questions about your parents. This includes queries about their marital status, Social Security numbers and state of residency. FAFSA for parents is very important, so you may want them to help you with this part. If your parents are separated, you’ll have to pick a “primary parent.” This will be the parent you spent the most time with over the last year.

What are some of the most important FAFSA requirements?

There are many factors that determine financial aid eligibility. Besides being a U.S. citizen or an eligible noncitizen, you must have a high school diploma or GED certificate. Using the aid also requires being enrolled or accepted as a student in an eligible degree or certificate program. Once you’re in college, you must maintain satisfactory academic progress to renew FAFSA. Every school has its own criteria for this.

When is the FAFSA deadline?

Those who want financial aid disbursement must submit their initial applications or FAFSA renewal before every academic school year. The national FAFSA due date for the 2019-2020 school year is June 30. Applications were open for submission starting October 1, 2018. For the 2020-2021 school year, you must file between October 1, 2019, to June 30, 2021.

Many students will have two applications out pending — one for the upcoming school year and another for the following year. Just remember that your FAFSA deadline for the school year will be by the end of June before classes start in fall.

In addition, you’ll have a state FAFSA due date. These also open for submission on October 1, but the deadlines differ between states. Most have a FAFSA priority deadline in the spring or summer. This “priority” means that students who apply by the due date will have first access to the state funds before they’re depleted. Be sure to check with your student aid administrator to find out the exact enrollment period for your state.

FAFSA - Everything You need to know about it

What if you need to cancel your application or make a correction?

To safely meet each FAFSA deadline, it’s best to file your application as close to the October opening date as possible. However, circumstances often change by the time school starts. That’s why the Department of Education allows applicants to submit corrections or updates by the end of the second week of September. For 2020, the FAFSA deadline for updates is September 12.

Many first-time applicants have a change of heart after choosing a college to attend. If you find yourself in this situation after already enrolling for classes and submitting your application, you’ll need to contact the school’s financial student aid office and cancel. It’s important to note that you may list up to 10 schools on a FAFSA renewal or initial application. You can always update your form with the necessary schools before the deadline.

What are the FAFSA income limits?

There are no FAFSA income limits or cutoffs when it comes to aid eligibility. While you must have some type of demonstrated financial need to qualify for aid, there’s no cap on income. FSA administrators will consider many other factors, including the size of your family and if you’re a FAFSA independent student, to determine how much aid you can receive.

The FSA calculates your financial need by subtracting your Expected Family Contribution from your college’s cost of attendance. For this reason, lower-income families and students going to pricier universities are likely to get more aid from grants and government student loans. To get an idea of how much you’ll receive, try using the FAFSA4caster, which is a FAFSA calculator that factors expected attendance costs.

How can you tell if you are a dependent or independent student?

Before you fill out your application, you’ll need to determine if you’re a dependent or independent student. If you’re a FAFSA dependent student, then you’re supported financially by your parents or a guardian. You’ll use their tax and household size information to get your results.

There are 10 questions on the application that deal with dependency. If you answer “yes” to one or more, then you’re a FAFSA independent student. These questions include:

What are the FAFSA requirements for providing tax information?

The 2019-2020 application requests 2017 income and tax information. For 2020-2021, you’ll provide income and tax info for 2018. This process is relatively straightforward for independent students, who’ll use their own documents. Dependent students will use their parents’ tax returns.

If your parents are separated, you must include at least one parent’s information on the form. Furthermore, dependent students are expected to put 50% of their personal earnings over $6,310 toward college. In certain cases, an applicant is not required to include tax information. Examples include if your parents are not U.S. citizens or earned below the minimum amount to file taxes.

How long does the application generally take to process?

If you completed your application on the web, the FSA office will process the results within three to five days. You can check your application status and Student Aid Report online using your FSA ID. If you submitted by mail, processing could take up to three weeks.

The FSA will also send your FSA to the schools you listed on your application. While every college can access this information the day after it’s processed, individual departments may have their own processing times. Most schools will create their financial student aid packages by the beginning of May.

You can expedite the student loan disbursement process by signing a Master Promissory Note (MPN). Your loans will then be sent out 10 days before you start classes. The promissory note is a legally binding contract in which you agree to repay the loan, accrued interest and fees to the Department of Education. You’ll have to pay those federal loans back six months after you graduate, drop out or drop below half-time status.

What are some great video resources I can watch?

If you need some more information on how to apply for FAFSA, consider watching a video tutorial. Here are some great FSA resources:

How to fill out the FAFSA application

FAFSA Application overview

Completing the FAFSA form and FSA ID

How can I find college scholarships and grants?

Whether you’re starting a new application or looking to renew FAFSA, your financial aid options extend beyond just student loans gov. There are thousands of grants and scholarships that offer academic funds you don’t have to pay back. It’s just a matter of knowing where to look for these opportunities.

The Department of Education website has information on all of the federal grant programs. These include the Pell Grant, which is need-based, and the Academic Competitiveness Grant and National SMART Grant, which are merit- and need-based. Be sure to also check out your state’s higher education website, which will list all of the available state-wide grants available.

It’s also worth browsing your school’s website for grants and scholarships. Every university has donors and partnerships that provide aid opportunities to students. Ask your academic advisor for more information. Of course, you’ll also want to do your own research online. There are hundreds of websites that list available scholarships by categories such as field of study, financial need and community group.

FAFSA - All you need to know about getting student aid

What are the different kinds of scholarships?

Scholarships are very similar to grants; however, they’re usually awarded to an undergraduate student based on an achievement, talent or some kind of ability. Here are the main types of scholarships:

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