Getting ready for the FAFSAJanuary 14th, 2014 by admin.capstone
Parents often tell me they aren’t sure they want to bother filling out the FAFSA – the long, complicated form that you must complete if you want your child to receive any federal financial aid.
They are pretty sure they make too much money to qualify for any government help. They’ve heard the FAFSA is a big hassle. Why subject themselves to that for nothing?
Well, I can list a few good reasons for them – 20,000 good reasons, in fact.
One family felt comfortable about their decision to skip the FAFSA process. At least, they did until they got a letter from their child’s new college. The school was willing to offer the student as much as $20,000 in tuition assistance – but without a completed FAFSA, the family would get nothing.
You see, it’s not just government aid that gets handed out via the FAFSA. Tuition assistance from individual colleges, state aid, even many scholarships – if you want to tap into any of those sources of money, you’d better get cracking on that FAFSA paperwork, and soon.
What’s the point of the FAFSA exactly? The FAFSA, short for the Free Application for Federal Student Aid, is how colleges determine how much each family is expected to contributed toward the cost of tuition. That amount is their Expected Family Contribution, or EFC. The difference between the cost of your school and your EFC is your “financial need,” and that’s how aid packages are calculated. Even if your family earns too much to qualify for federal grants or work-study programs, you may be eligible for thousands of dollars in tuition assistance from the school itself, particularly if you’ve chosen a private school.
Is there any kind of income cutoff? Well, eventually, but it’s much higher than you probably think. Need-based aid is figured via a complicated formula that takes into account family size, number of students in the family attending college simultaneously, and even the age and marital status of the parents. Even if your family income is well over six figures, your family may still qualify for some forms of assistance.
What do they want to know? You’ll need to submit personal and financial information for parents/guardians and the dependent student. This will include earnings, income, savings, investments and real estate holdings. (The family home does NOT count, however; don’t make the mistake of including it!) You do not need to wait until you’ve completed your 2013 income taxes. Instead, use your best estimate for those numbers, and then update the form after you’ve filed your tax return.
When do I need to submit this? The earliest you can submit the application for next year is January 1, via the online application at www.FAFSA.ed.gov. Do it as soon after that date as you can. Most aid is distributed on a first-come, first-served basis, and many universities prefer that you submit your FAFSA by February 1, so procrastination can cost you in cold, hard cash.