Guide to the FAFSA

It's no secret that the cost of college has gone up over the last several years, but just how much it's changed might surprise you. According to research published by the College Board, the average annual cost of tuition and fees at public four-year universities has more than tripled in the last 30 years, rising from around $3,300 in 1988-89 to more than $10,000 in 2018-19.

As costs have skyrocketed, federal student aid has become even more important in the college process. The College Board reports that total of more than $240 billion was awarded in 2017-18 — nearly $15,000 per undergraduate and more than $27,000 per graduate student. Federal sources, such as Stafford Loans, Pell Grants, Perkins loans and more, accounted for around 56 percent of that total, or more than $135 billion for the year.

There's also some good news for prospective students, however: you're likely eligible for a piece of that huge federal outlay, provided you take the right steps to qualify for it. The Free Application for Federal Student Aid (FAFSA) is the only way to potentially lay claim to college assistance from federal funds, and our FAFSA guide can tell you what you need to know to make it work for you.

What is the FAFSA?

Put simply, the FAFSA is a universal financial aid application. There are numerous federal student aid programs, but the FAFSA is the only document you need to submit to start the application process for most of them. On top of that, many state and institutional sources of aid also require an up-to-date FAFSA to help awards committees accurately gauge your financial need.

One important result of the FAFSA process is a figure known as your expected family contribution, or EFC. To figure out your EFC, you provide information about your income and other assets and the Federal Student Aid office uses a detailed formula to calculate how much you or your family should be able to contribute to your college expenses.

The EFC takes into account financial information for both you and your parents. If your parents are divorced, then the parent with whom you lived with the most over the prior year is the one whose finances you'll disclose. Of course, if you live apart from your parents as an independent student and don't expect them to contribute to your college costs, you'll fill out your FAFSA with just your income information.

Your EFC determines your eligibility for programs like the Pell Grant, and the difference between your EFC and the cost of the college you choose represents the maximum federal aid you're eligible to receive. The financial aid department at your college then works to put together an awards package that can bridge the gap between their attendance costs and your expected family contribution.

The formula for determining financial aid eligibility may be complex, but the FAFSA website has a tool called the FAFSA4caster that can provide an estimate of the amount of aid you're likely to qualify for. The site also keeps your data on file once you've completed your FAFSA, allowing you to review or update it as needed, and provides valuable information about application deadlines and other things that students need to know.

FAFSA Eligibility

Federal aid can be awarded to any student who meets the FAFSA eligibility criteria set by the U.S. Department of Education. Here's a rundown of what it takes to qualify, as of 2019:

• Demonstrate adequate financial need (for most programs)
• Be a citizen of the United States or a noncitizen from one of six eligible groups
• Have a valid Social Security Number
• Show that you're qualified for college by earning a high school diploma, a recognized equivalent like the General Educational Development (GED) certificate, an official homeschool completion credential or an alternative benefit qualification through an eligible career pathway program
• Register for Selective Service, if male and between the ages of 18 and 25
• Be enrolled at least half-time or accepted for study in a college program eligible for Direct Loan Program funds
• Maintain satisfactory progress toward a degree or certificate
• Certify on the FAFSA that you're not in arrears or default on a federal grant or loan program and that you will only use federal funds for educational purposes

Aid programs offered at the state and institutional level often have different criteria than the general FAFSA eligibility rules, so make sure to visit your financial aid office to learn more about other sources of aid that might be available.

FAFSA Timeline: Important Dates and Deadlines

• Each next year's FAFSA becomes available on October 1 of the current year. For example, students seeking aid for the period between July 1, 2021 and June 30, 2022 can begin filling out their FAFSA on October 1, 2020.
• Your FAFSA must be submitted before midnight on June 30 to be accepted for the upcoming award year.
• Corrections or updates to your submitted FAFSA may be made until the second week of September of the upcoming award year. The 2020-21 deadline is September 11, but the exact date can change from year to year.

Some states and colleges may have different FAFSA deadlines than the basic federal requirements. The University of Nevada, Las Vegas (UNLV), for example, encourages students to complete their FAFSA by December 1 to secure eligibility for institutional scholarships, and Oregon's University of Portland offers priority consideration to students who turn in their applications by January 15.

How to Fill Out the FAFSA

The process for completing the Free Application for Federal Student Aid is pretty straightforward, if you know the steps. Here's a quick FAFSA guide to help you fill it out accurately:

1. Create an FSA ID. Your Federal Student Aid (FSA) ID is the username and password that you use to officially sign your online FAFSA form. The process of creating an FSA ID takes about 10 minutes, although repeat borrowers may need to wait a few days for the account verification process to complete. If you're classified as a dependent student and your parents' financial information is required by the FAFSA, your parents will need their own FSA ID to co-sign the application.
2. Gather important documents needed to apply. You'll need your Social Security Number (or your Alien Registration Number, for eligible noncitizens), federal income tax returns, bank statements and asset records (if applicable). Students and parents both may be able to attach their tax returns to the FAFSA electronically using the U.S. Department of Education's IRS Data Retrieval Tool.
3. Fill in your personal information.Your name, date of birth and other basic information that matches your record in the Social Security database must be entered in the form.
4. List colleges you plan on applying to. The information you enter into your FAFSA will only be sent to the colleges you list on the application, so make sure to add every school you're thinking about attending when you get to this section. The form itself provides space for up to ten schools, but students casting a wide net can add additional colleges to the list once they've submitted their FAFSA and received their Student Aid Report.
5. Determine dependency status. The dependency section of the FAFSA will ask you a series of around a dozen questions to determine whether you're considered a dependent or independent student. Whether or not you'll need to provide your parents' financial information depends on the outcome of this section, so answer carefully and honestly.
6. Report parents' information. If you're considered a dependent student, the next section of the application will ask you for basic demographic information about your parents. Students who don't live with their parents must still complete this section, if they're considered dependent students for federal aid purposes. Here's a handy infographic from the U.S. Department of Education to help you sort out what information you'll need to supply.
7. Provide financial information. This step can be very easy, if you use the IRS Data Retrieval Tool provided on the FAFSA site. Electronically transferring your tax information — and your parents' tax information, if necessary — can speed up the application process and reduce the amount of paperwork required by your school's financial aid office. Some applicants, such as international students who have never filed with the IRS, may not be eligible to use the tool, but most U.S. residents should have the option.
8. Sign and submit. Your FSA ID allows you to virtually sign the FAFSA and submit it online. Parents of dependent students must sign with their FSA ID as well. The online process is the fastest way to find out your eligibility status, but students may also print a signature page from the FAFSA site and submit by mail.

What to Do After You've Submitted the FAFSA

Once you've finished your FAFSA, it usually takes a few days for the results to be calculated. Here's a list of next steps that you can take once you receive your decision:

1. Check your Student Aid Report. You can receive a Student Aid Report (SAR) by email in three to five days, or by postal mail in seven to ten days. The SAR summarizes the information you submitted and provides you with the all-important EFC figure that was calculated based on that information. If your FAFSA is incomplete in any way, your SAR will point out any issues that need to be resolved.
2. Make any necessary updates or corrections. If you notice any mistaken information on your SAR, or if anything has changed since you filed your FAFSA, you can make changes either online or by filing a paper form by mail. During this step, you can also authorize that your FAFSA info be sent to colleges other than the ones listed on your original application.
3. Review your award package. Most federal aid packages come with a combination of grant money (if you're eligible) and approvals for subsidized and unsubsidized loans. If you have any questions or concerns about your award package, address them with a financial aid adviser as soon as you can.
4. If necessary, appeal your eligibility decision. Financial aid officials at your college are generally experienced with the federal aid system, and they also may have access to other forms of aid. If you can appeal to them with a fact-based case focusing on your value as a student and any extenuating circumstances in your family's financial situation, they may be able to help you find a resolution.
5. Revisit the process each year. The student aid you receive in your first year is not locked in for the rest of your college career. It's necessary to reapply for aid every year that you're in school, making sure to keep your FAFSA information updated to reflect any changing circumstances.

It may seem like a lot of responsibility, but the time you spend working on your FAFSA and connecting with financial aid advisers on campus can pay off big in the long run. Staying engaged with the process can help you ensure that you get every dollar of aid that you're eligible for.

FAFSA Tips

The FAFSA website is designed to walk you through smoothly through the application process, but there are a few FAFSA tips that may not be obvious to a student applying for the first time. Keep the following FAFSA tips in mind as you gather your information and apply:

• File well before the deadline. FAFSA deadlines are fairly generous, giving students nearly eight months to get their application together. There are a few good reasons to file as early as possible, however; some programs like the Pell Grant may be available year-round to all qualified students, but others like the Perkins Loan and work-study programs have finite funds that may be awarded on a first-come-first-served basis. Your school may also offer priority consideration to students who submit by their early filing deadline.
• File online. You have a choice between filing online or by mail with a paper form, but processing time is typically much faster if you file online. Online filing also enables you to review and update your information much more easily than if you file by mail.
• Think a year ahead. You'll need to provide updated information on your FAFSA every year, so starting next year's application during your current fall semester can help you keep on top of your financial aid situation.
• Don't be afraid to appeal. If your awards decisions don't seem to match with what you expect, it doesn't hurt your aid status to appeal. Check with your financial aid department to learn the details of the appeal process at your college or university.
• Make sure to use the right FSA ID. According to the U.S. Department of Education, the most common mistake they see on FAFSA forms is confusion between a student's own FSA ID and the one assigned to their parents. If you're a dependent student, pay close attention to which ID goes into which field on the form.
• Do a dry run with the FAFSA4caster. Knowing how much aid might be coming to you can help you make solid financial plans for each academic year. The FAFSA4caster tool provides an estimate based on your current information and allows you to see how certain variables might impact your eligibility for aid.

It's also good to be familiar with the many different forms of aid that might be available. The U.S. Department of Education offers a high-level breakdown of types of aid to help students stay informed.