Understand FAFSA Before Senior Year In High School

HomeUncategorizedUnderstand FAFSA Before Senior Year In High SchoolThis page may contain affiliate links.Jan 10, 2018Too many families dont start thinking about the Free Application for Federal Student Aid (FAFSA) until the fall of their students senior year. After all, you cant even submit the form until October 1st so why start worrying sooner? Because the FAFSA is just the final step in the financial aid process. And if you dont take the right steps before you actually submit the application, you can dramatically reduce your opportunities for financial aid. Your Financial Aid Application Starts in the Sophomore Year The FAFSA uses your financial information for the tax year that starts January of the sophomore year. This means that most families EFC is determined before students decide which colleges to apply to. Why Do You Need to Know This? Because for some families, there are a few simple things they can do that can have a significant effect on their EFC. The FAFSA assess the amount of money available for financial aid differently depending on who the money belongs to and how it is being used. If you wait until you file the FAFSA to find this out, you wont be able to do anything about it. You EFC is a Minimum Amount Youll be Expected to Pay Theoretically, the Expected Family Contribution (EFC) calculated by the FAFSA should be the maximum a family pays for college. However, the bulk of the financial aid to meet the student need comes from the colleges that students actually attend. And most colleges simply do not have the money to meet 100% of student need. Why Do You Need to Know This? Because some colleges are more likely to meet student need than others. Furthermore, many schools practice some form of preferential packaging. This means that schools provide more desirable financial aid, grants and scholarships, to students they really want to attend. For less competitive students, colleges may offer financial aid consisting of various loans. Families need to know this information so that students can apply to colleges most likely to meet their financial need. The FAFSA isnt the Only EFC Over 200 colleges require students to submit another financial aid form called the PROFILE in order to qualify for institutional aid. That is, if you want money from the college and not just the government, you have to submit the PROFILE. The PROFILE has its own methodology for calculating EFC, usually referred to as the institutional methodology. Why Do You Need to Know This? Because the PROFILE uses information the FAFSA doesnt, including home equity and non-custodial parent income. And since each school has its own methodology, you cant use a generic EFC calculator to estimate your costs. Given how differently the PROFILE treats certain assets, you may want to target PROFILE schools or avoid   Freelancer View all posts CATEGORIES UncategorizedNEWER POSTWhy A 529 Plan Is The Best Way to Prepare Your Family For College ExpensesOLDER POSTWhat Is FAFSA?