A Discover Student Loans survey found that 97% of participants plan to take advantage of the Free Application for Federal Student Aid. Even so, parents struggle with questions related to how to get financial aid, how early they can apply, and the documents they need to get the ball rolling.
Parentology spoke to several college applications and financial aid experts. Here’s what they had to say about applying for FAFSA.
This requires more than being able to afford tuition payments. College funding expert, Jocelyn Paonita Pearson, founded The Scholarship System to help students secure scholarships and graduate debt-free. She explains that student assets get factored in at a higher percentage than parent assets for FAFSA. Because of this, parents may want to minimize assets in the student’s name before applying.
Families should also learn about the Expected Family Contribution and calculate how this affects eligibility. According to the FAFSA official site, “The Expected Family Contribution (EFC) is a measure of your family’s financial strength, and is calculated according to a formula established by law.” This creates an estimate regarding the family’s ability to cover a certain portion of college expenses, and from that number the college calculates the financial aid.
The next step involves collecting all documents ahead of time. Pearson recommends keeping the following items close by during the application process:
- Tax returns
- Bank statements
- Investments statements
- Business statements (for business owners)
According to the US Federal Student Aid website, each university listed on the FAFSA form gets a copy of the information submitted. The website asserts that ranking does not affect federal student aid. Ranking may, however, affect state aid. Pearson recommends ranking the universities in the order of preference or priorities whenever possible. Universities do get to see the list and may assume they are merely a back-up plan if they are further down.
Abril Hunt has more than 20 years of experience working in the financial aid field. She tells Parentology, “Pay attention to your state’s deadlines. Many states with limited amounts of funds are awarded on a first-come, first-served basis, so the earlier you file your FAFSA, the better. Filing early will ensure you get the maximum aid possible. Some funds do run out.”
Pearson advises all families to apply, even if you make six figures. She notes, “This not only opens the doors to federal funding but also helps universities decide if they should offer the student additional funds. We know of at least one family who missed out on $17,000 per year by assuming FAFSA wouldn’t benefit them.” She also reminds students and their parents to reapply every year.
Use the IRS Data Retrieval Tool
Amanda Black is the associate director of communications and financial literacy at Saint Leo University. She advises students to apply online and always use the IRS Data Retrieval Tool whenever possible.
“This tool cuts down on the time it takes to file your FAFSA, as well as the chances of submitting erroneous information,” she explains. Note that it takes roughly half an hour to complete the form. The site does store information, making it easier and less time consuming the next time around.
The Discover Student Loans survey found that only one-fourth of parents knew that FAFSA applications open up on October 1st. Remember that the earlier you file the more aid you may receive, so get started on the process as soon as possible.
Tackle Next Year’s Financial Aid Now — Sources
Abril Hunt, Educational Credit Management Corporation
Jocelyn Paonita Pearson, The Scholarship System
Amanda Black, Saint Leo University
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