It’s time for the FAFSA, that rite of college that has become a familiar trial for students and parents wrangling with the costs of higher eduction — and now it starts earlier.
So here’s what you need to know about the Free Application for Federal Student Aid, including the biggest mistakes you can make that can cost you thousands in financial aid, according to Experian and CollegeXpress:
▪ It comes earlier in the year. In the past, FAFSAs were accepted beginning Jan. 1. Last year it was moved to Oct. 1, but some families are still holding off until January. Big mistake, according to Experian: some financial aid is awarded on a first-come, first-serve basis, including the Illinois MAP grant. Assistance in 13 states is awarded in order of application, according to CNBC. In years past, Illinois MAP funds have run out three months or less after FAFSA applications were opened, so it pays to be first in line. There are multiple deadlines as well: the college deadline, state and federal deadlines.
▪ You may qualify for more aid than you think. Some families don’t bother with the FAFSA because they believe they make too much money to qualify for grants, according to Rick Castellano of Sallie Mae. But families of moderate incomes may still qualify for scholarships or university-based grants, which have higher income limits. If you are considering student loans, the FAFSA will also indicate for how much you are eligible.
▪ You will need to determine whether the student is dependent or independent, based on a number of factors. The online application will walk you through this process, as it may drastically change how much aid to which you are entitled.
▪ Are the student’s parents divorced? The financial information you report will be for the custodial parent and stepparent, if any. Noncustodial parents’ income is not reported.
▪ Filling out the FAFSA does not obligate you to accept financial aid. It’s simply telling you what you qualify for, both in grants and loans, and then you can choose which offers (if any) you accept. It is often a necessary first step for scholarships as well, so it hurts nothing to fill it out.
▪ Be prepared. The FAFSA requires extensive financial information from parents and students. You will need to report all required sources of untaxed income, including Social Security payments, child support paid or received, and worker’s compensation, according to FastWeb. Take advantage of the IRS Retrieval Tool, which electronically transfers information from your federal tax return and eliminates much of the hunt-and-peck that comes with filling out the financial information. If your student made enough money to be reported on a W-2 or 1099, but not enough to file a tax return, you will still need to report that income. Don’t guess! You will also need separate logins for parent and student, so go ahead and create those logins early — and don’t forget to sign it, including online!
▪ Name as many schools as you can. You can list 10 schools on a FAFSA, and if you neglect to put in a school that you later reconsider, you will have to add it – and then you’ll be getting in line behind everyone else. Since it doesn’t obligate you to anything, the best strategy is to list every school you might conceivably consider. List them in order of your interest, with state schools first – some state schools give more aid to students who listed them at the top of the list, according to Experian.
▪ Do not wait until your tax return is filed to do the FAFSA. This was a bigger issue when FAFSA season opened in January, but even now some families wait until the taxes are done, and potentially miss out on a lot of grants and other aid. If your student will begin college in fall 2018, you fill out the FAFSA now with your tax return from 2016. You may be required to amend it later if you have a major change in circumstances, but you should absolutely not wait until you file your 2017 taxes to fill out a FAFSA.
▪ Don’t pay to file. “The first word in FAFSA is ‘free,’” Castellano said, and you can get assistance with filling it out from high school counselors, financial aid offices, and the U.S. Department of Education. Make sure the website you’re using ends in .gov — if they ask you for a credit card number, it’s a scam.
▪ You should receive a Student Aid Report three days to three weeks after submitting your FAFSA. Check it over in case there are mistakes — if so, you can amend your FAFSA online or on paper. Shortly thereafter, you will get an aid offer from the schools you put on the form, sometimes called an award letter.
▪ You may be selected for verification. According to FastWeb, about 30 percent of FAFSAs are selected to provide additional documentation — sometimes at random, and sometimes because a university volunteered to have all its FAFSAs verified. Don’t panic! This is usually routine, sometimes as simple as verifying a marriage certificate.
For more information on FAFSA, call the U.S. Department of Education at 800-433-3243 or visit their website at studentaid.ed.gov. There are detailed instructions for completing next year’s FAFSA on the federal website.