Millions of people miss out on federal aid, grants, and loans partially due to a simple reason: ignorance.
Most people think you must be in need or low-income to get help.
Some think you need to be successful before you’re considered for aid.
Others think you have to be a student or have a disability.
But there are plenty of programs for people who don’t fall into those categories.
As the academic year closes, every student needs to complete the Free Application for Federal Student Aid or FAFSA to access college financial aid.
This article will provide a detailed overview of the FAFSA and what you need to do to complete it. We’ll also answer some common questions about the FAFSA process.
First, let’s discuss everything you need to know before filling out the FAFSA.
What is the FAFSA?
FAFSA is the Free Application for Federal Student Aid. It determines your eligibility for federal, state, and institutional financial aid.
It also awards grants, loans, and work-study funds to eligible students. And it’s also used to determine your eligibility for federal and state student aid programs, like the Federal Pell Grant program.
The FAFSA is required by nearly all colleges and universities to be considered for any type of financial aid. And it must be filled out every year that you’re enrolled in college.
The Impact of FAFSA on Education
The FAFSA was introduced in 1992 as part of the Higher Education Act. The goal was to make college more accessible and affordable for everyone.
And while the form has changed over the years, the goal remains to help students and their families pay for college.
In 2021 alone, it’s estimated that the FAFSA will help distribute more than $149 billion in financial aid.
This includes federal grants, loans, and work-study funds. It also includes state and institutional aid, like scholarships and grants.
So as you can see, the FAFSA is a critical part of the college process. And it’s important to understand how it works before you begin filling it out.
Now that we’ve answered some common questions about the FAFSA let’s move on to the next step: how it works.
How Does the FAFSA Work?
The FAFSA form is used to collect students’ financial information. This information is then used to determine your eligibility for financial aid.
You’ll need to provide basic personal and financial information to fill out the form. This includes your;
- Social Security number,
- your parent’s financial information, and
- your household size.
You’ll also need to provide information about your income and assets. This includes your:
- Income tax return,
- W- two forms,
- bank statements, and
- investment records.
Once you’ve gathered all the required information, you can begin filling out the form. The form is available online at studentaid.gov.
You can also get help from your school’s financial aid office or a professional FAFSA preparer.
Once you’ve completed the form, you’ll submit it to the federal government. They will then calculate your Expected Family Contribution or EFC.
Your EFC is the amount of money your family is expected to contribute to your education. It’s based on your family’s financial situation and household size.
The government will then use your EFC to determine your eligibility for financial aid.
What Happens After I Submit the FAFSA?
Once you’ve submitted the FAFSA, you’ll receive a Student Aid Report or SAR. This is a summary of the information that you provided on your FAFSA.
The SAR will also list your EFC and tell you how much financial aid you’re eligible for.
If you’re eligible for financial aid, the next step is to accept or reject the aid offered to you.
You can do this by logging into your student aid account at studentaid.gov.
From there, you’ll be able to see all of the aid offered to you. You can then accept or reject the aid, as well as any conditions that are attached to it.
You’ll also be able to use your student aid account to complete any necessary paperwork for your financial aid.
But before you fill out the FAFSA, there are a few things that you need to know.
Who Is Eligible for the FAFSA?
To be eligible for the FAFSA, you must meet the following criteria:
- You must be a U.S. citizen or an eligible non-citizen.
- You must have a valid Social Security number.
- You must be enrolled in an eligible degree or certificate program.
- You must have financial needs.
- You must not be in default on a federal student loan.
- You must not owe money on a federal grant.
- You must be enrolled at least half-time to receive most types of aid.
Tips to Help You Complete the FAFSA
a. Create your FAFSA ID 3 days before you plan to fill out the form.
Your FAFSA ID is a unique identifier that allows you to access your FAFSA form. You’ll need your FAFSA ID to sign your form electronically.
You can create your FAFSA ID at studentaid.gov.
Many people don’t realize they need a FAFSA ID, so they fill out the entire form until they’re asked for an ID.
But here’s the kicker: it takes the Social Security Administration about 72 hours to process your FAFSA ID.
So if you wait until the last minute to create your ID, there’s a good chance you won’t be able to finish your form on time.
b. Fill it out early
You can fill out the FAFSA starting on October first of each year. But many schools have earlier deadlines, so it’s important to check with your financial aid office.
The earlier you fill out the form, the better. That’s because some types of aid are awarded on a first-come, first-served basis.
A good rule of thumb is to fill out the FAFSA as soon as possible after October first.
If you wait too long to fill out the FAFSA, you may miss out on some of the aid you’re eligible for.
c. Gather your documents before you start
Before you begin filling out the FAFSA, gathering all required documents is a good idea.
This includes your Social Security number, your parent’s financial information, and your income tax return.
You can find a complete list of the required documents at studentaid.gov.
d. Get professional help
If you need help filling out the FAFSA, a few options are available.
First, you can contact your school’s financial aid office. They can help you with the form and answer any questions.
Second, you can hire a professional FAFSA preparer. This is someone who specializes in helping people fill out the form.
e. Double check your work
Before you submit the FAFSA, it’s important to double-check your work. This includes ensuring that all the information is accurate and that you’ve signed the form.
If you make a mistake on your FAFSA, it could delay the processing of your form. In some cases, it could even result in you getting less financial aid than you’re eligible for.
The FAFSA is an important form, but it doesn’t have to be scary. By following these tips, you can ensure that you fill out the form correctly and on time.
Do You Have To Repay FAFSA Aid?
One of the most common questions about financial aid is whether or not you have to repay it.
The answer is that it depends on the type of aid you receive.
Some types of aid, such as grants and scholarships, don’t have to be repaid. Other types of aid, such as loans, do have to be repaid.
Understanding the difference between these types of aid is important before you accept any money.
If you’re unsure whether or not you have to repay a type of aid, you can always ask the financial aid office at your school. They’ll be able to give you more information about the specific type of aid that you’re interested in.
So, do you have to repay financial aid? It depends on the type of aid that you receive. Be sure to ask about repayment before you accept any money.
What To Do If You Can’t Repay Your Loans
If you can’t repay your loans, don’t panic. There are a few things that you can do to deal with the situation.
First, you should contact your loan servicer. They’ll be able to help you understand your options and choose a repayment plan that’s right for you.
There are a few different repayment plans available, so it’s important to find one that fits your budget.
You may be eligible for deferment or forbearance if you can’t afford your monthly payments.
Deferment allows you to temporarily stop making payments on your loan. Forbearance allows you to temporarily make smaller payments.
Both of these options can help you get through a challenging financial situation.
If you’re having trouble repaying your loans, contact your loan servicer. They’ll be able to help you choose a repayment plan that fits your budget. You may also be eligible for a deferment or forbearance.
What’s Next?
Now that you know everything about the FAFSA, it’s time to start filling out the form.
You can find the form at https://studentaid.gov/h/apply-for-aid/fafsa. Remember to gather all of the required documents before you begin.
If you need help filling out the form, you can contact your school’s financial aid office or hire a professional FAFSA preparer. Leave me a message at jared@redwoodplanning.com, I’ll respond the same day.
