• First of all, what is the FAFSA?  It is an online application administered by the United States Department of Education.  You find it at www.studentaid.gov.

  • The FAFSA is the gateway to grants and aid that can make college more affordable for lower-income families. 

  • To apply for the FAFSA, students, and parents create a secure account and enter some fairly basic financial and family information.  The Department of Education then pulls in tax return information directly from the Internal Revenue Service and determines the Student Aid Index (also called the SAI).  This starts the process on a few things:

  • First, the Student Aid Index determines whether a student is eligible for a Pell Grant.  Pell Grants are free money - ranging from around $700 to just over $7000 per year - for college costs. By “free money,” I mean that this money is a grant, not a loan.  It does not need to be paid back.

  • The Department of Education then shares this information (not the underlying financial information, but the SAI and related information), with schools that the student asks them to share it with.  So, if a student is applying to five schools the student would list those five schools on their FAFSA and those schools would receive reports from the Department of Education.

  • When universities receive this information, they use the SAI and related information to determine if the student qualifies for other assistance based on their financial need.  For example, some public universities award additional grants (again - money that does not need to be paid back) to students above and beyond the Pell Grant, and many private universities have similar programs. 

  • The FAFSA is a valuable tool and opens the door to financial access.

  • Your family start the process by creating your FSA IDs - your student and the parent filling out the FAFSA will both need to apply for one.  All of this can be done through the www.studentaid.gov website, which is where you will also fill out and submit the FAFSA

  • Under the federal Pell Grant / financial aid process, the STUDENT is the recipient of the aid. Not the parent. The FAFSA website is likely to have answers to any questions you have about eligibility - there are wizards, a comprehensive FAQ section, a live chat box as well as phone contacts to help students and families

  • Some families are pretty convinced that they will not qualify for need-based financial aid, and don’t see a point to filling out FAFSA.  Every family needs to make their own decision on that, and as we have said, we won’t tell anyone what they should or shouldn’t do. But, here are a few things to know about and consider:

  • The www.studentaid.gov site includes an estimator - kind of like the Net Price Calculator but for FAFSA purposes.  There are also calculators on financial planning websites. 

  • Some students know that they are unlikely to qualify for need-based assistance but are planning to apply for merit-based aid or scholarships (we are going to cover those in our next video).  Some of those scholarships require that a student has submitted FAFSA - whether or not they qualified for aid doesn’t matter. (Note: they shouldn’t ask you for information from your FAFSA — but they might want confirmation that you submitted it.)

  • Some on-campus jobs require that the student applying has filled out FAFSA.  It might not require that the student was eligible for aid, but requires FAFSA.

  • Students who fill out FAFSA are eligible for a yearly loan, starting at $5500 and increasing a little bit each year through college.  Students don’t have to accept this loan, but it is available to activate if necessary.  For some families, it makes sense to have this loan available for emergencies.

  • Again, every family is different, but some families choose to use these loans to ensure their student has some proverbial skin in the game, or otherwise motivate a serious and responsible approach to college.

  • And finally, you never know.  Sometimes, circumstances change.  There are a few colleges that won’t consider financial need if the FAFSA was not filled out in year one.

  • And one more thing.  Some colleges use the College Board’s College Scholarship Service Profile, also called the CSS.  This is separate from the FAFSA.  It asks for much more detailed financial information.  If your student is applying at a school that uses the CSS Profile, you should review their application page for more information.

  • In sum, the FAFSA is a straightforward and helpful tool that can open many doors.  It was updated last year and there were glitches, but we expect it to be smoother for everyone this year.  Don’t skip filling it out!

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