Editor’s Note: The new, simplified FAFSA form for the 2024-2025 academic year is available, although applicants are reporting a number of glitches. Try not to worry, take your time, and aim to submit your application as soon as possible.
Applying for federal aid is a crucial step most high school students take while transitioning to college life. Parents going through the college admissions process for the first time, though, may not realize that they also play a huge role in helping their children apply for grants and scholarships through the Free Application for Federal Student Aid or FAFSA®.
Applications for the 2023-2024 round of FAFSA opened on Oct. 1 and will remain open until June 30, 2024. If you’re looking for facts about FAFSA that will help your child apply for college aid during the 2023-2024 academic year, we’ve compiled some of the most important information on how you can help your child during the FAFSA process.
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FAFSA Facts and Tips
Filling out FAFSA for the first time? These facts and FAFSA tips can help you prepare for the application process and offer suggestions for getting the most aid.
1. FAFSA Is Required to Receive Government Student Loans
For those who may be new to the financial aid process, FAFSA is the form students fill out to apply for federal financial aid. Just over 18 million students fill out the FAFSA each year. Your child won’t be eligible for government-funded college aid, such as federal loans or grants if they don’t apply.
Recommended: 12 Steps to Filling Out the FAFSA Form for School Year 2023-2024
2. Your Child Could Qualify for Grants by Filling Out FAFSA
While you can get subsidized or unsubsidized loans through FAFSA, your child may also be eligible for grants. One common federal grant is the Pell grant, which is awarded to first-time undergraduate students who show exceptional financial need, such as coming from a low-income family.
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3. It Determines Work-Study Eligibility
Federal work-study is a way for students to earn income at a part-time job while in college. These jobs can be on or off-campus and vary by school, although not all schools participate in the program. You have to fill out FAFSA to determine if you’re eligible for work-study programs.
4. Some Schools Use FAFSA to Determine What Aid They Offer
If the schools your child applies to offer their own aid, such as need-based scholarships, they may use FAFSA to determine eligibility. You may want to check with the schools your child is applying to and ask if they have a separate application for internal scholarships and grants.
5. Most Applicants Under Age 22 Are Considered Dependents
Most students under the age of 22 who are neither married nor parents themselves won’t be able to apply as an independent student . As a result, for most incoming freshmen, their parents’ income is counted in the determination of financial need.
Recommended: Independent vs Dependent Student: Which One Are You?
6. Your Child Needs Your Information to Apply
If your child is filing as a dependent, then they’ll need some basic information about your finances, such as your income and paid taxes. You may also elect to apply for a Parent PLUS loan, which can help cover your child’s educational expenses if they don’t receive enough in loans and grants to cover costs. Note that you may need additional information to apply for a Parent Plus loan.
7. High-Income Families May Want to Still Apply
If your family is middle- or upper-class, you may wonder if your child will receive any FAFSA aid. However, applying is free, and family income is just one of many factors considered during the application process. Additionally, your child’s school still may require FAFSA to be eligible for institutional aid, so it may be worth applying for even if you don’t think your child will need or receive aid.
8. Grades Don’t Affect FAFSA Eligibility
FAFSA does not have a GPA requirement to apply. However, your child may want to keep in mind that they could lose any aid given to them through FAFSA if they have poor grades for multiple semesters after they receive the aid.
9. Deadlines May Differ by State and School
While the FAFSA doesn’t close until June 30, 2024 for the 2023-24 academic year, FAFSA application deadlines may vary by state and school. State and school deadlines may close prior to the federal deadlines. If you’re not sure what deadlines apply to your student, consider checking with the financial aid office of each school your child applies to and ask what their FAFSA deadlines are.
10. Having Multiple Kids in College No Longer Affects Financial Aid Awards
Since 2021, the number of children in a family who are in college or applying to college no longer affects aid eligibility. Before, families with multiple children in college may have qualified to receive more aid. This is one of many changes throughout the FAFSA Simplification Act, which aims to simplify the FAFSA form and therefore hopefully encourage more families to fill out FAFSA.
11. Expected Family Contribution Is Also Changing
Expected family contribution (EFC) is an estimate of how much FAFSA believes families can contribute to the cost of a student’s education. However, as part of the FAFSA Simplification Act, EFC will be replaced with the Student Aid Index, or SAI, starting on July 1, 2024 (for the 2024-2025 academic year). While that may sound far off, a freshman during the 2023-2024 academic year will be a sophomore when SAI is put into effect.
12. FAFSA Is Changing the Process for Children of Divorce
Before the new simplified FAFSA, in the case when a child’s parents are separated, the custodial parent’s information was included on the form. However, with the new changes, the parent who provides the most financial support to the student is responsible for filling out the FAFSA.
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13. Your Child Will Need Their Social Security or Alien Registration Number
As your child prepares to fill out the FAFSA, they’ll need their Social Security or Alien Registration number.
14. Have Nontaxable Income at the Ready
One question that may trip up parents is what FAFSA considers nontaxable income. For FAFSA, that generally includes (but is not limited to):
• Workers compensation
• Disability benefits
• Welfare benefits
• Social Security income
• Veteran’s benefits
• Military or clergy allowances (if applicable)
• Foreign income not taxed by any government
15. Your Child May Need to Report Grants and Scholarships
Most first-time college students won’t need to report any grants or scholarships they received. However, they may if they had to report them on their taxes, such as:
• AmeriCorps benefits, such as living allowances or awards
• Taxable work-studies, assistantships or fellowships
• Combat pay, special combat pay, or cooperative education program earnings
• Other grants or scholarships reported to the IRS
If you have any doubts about what types of grants may be taxable, consider consulting a tax professional.
16. Have Bank Statements Available
To fill out FAFSA, you’ll need bank statements for both you and your child. This information helps determine how much aid your child will be eligible for.
17. You Don’t Have to Have a Social Security Number to Sign the Form
If you’re filing for FAFSA online, you can create a federal student aid (FSA) ID . This is simply your login and password. Your child can create one here . But if you don’t have a Social Security number, you can print out the signature page of the form, sign it, and mail it in.
18. You Don’t Need to File Taxes Before Submitting FAFSA
If you filed for an extension for your tax return, you can use your W-2 or 1099 statements. But you will need to update FAFSA once you file. This is because which tax bracket you’re in can impact how much aid your child is eligible for.
Recommended: What Tax Bracket Am I In?
19. You’ll Need to Have a List of Assets Ready
FAFSA uses parental assets to help determine aid eligibility. You’ll need to know how much in assets you have, which include (but are not limited to):
• Money in cash, savings, and checking accounts
• Non-retirement investments (such as stocks and mutual funds)
• Businesses that have more than 100 full-time equivalent employees and you and your family have minority stakes in
• Investment farms (in other words, you don’t live on and operate the farm)
• Other investments, such as real estate and stock options
20. 529 Plans Are Also Considered Assets
When filling out information about assets, you’ll also need to provide the value of all 529 College Savings Plans you own — including the accounts for siblings. Also, if your child owns a 529 plan (often called an UGMA or UTMA 529 plan), you will need to report it as a parental asset – and not as the student’s asset. (Please note, however, that if your child owns a UGMA or UTMA account that is not a 529 plan, you don’t list it as an asset — your child does as their asset.)
21. Your Primary Home Doesn’t Need to Be Listed as an Asset
One common FAFSA mistake is listing your primary home as an asset. However, FAFSA does not require you to do so. In fact, listing it as an asset can decrease the amount of aid your child receives.
22. You Don’t Need Your Retirement or Insurance Information
FAFSA also doesn’t count retirement or insurance accounts as assets. Again, including them can inflate the number of assets you have and therefore may decrease the amount of aid your child is offered.
23. You’ll Need to Include Each School Your Child Is Applying To
When you and your child fill out the FAFSA, you’ll want to have a list of all the schools your child may be interested in applying to. You’ll need each school’s federal school code to add them to the list of schools you want your FAFSA information sent to, although you can also search for this information on the form itself if you can’t find it on the school’s website. It may be wise to include schools your child isn’t sure they want to apply to yet since it’s easier to simply add the school to the list now than having to send the school your FAFSA information later.
24. Schools, Not the Government, Will Give You Financial Aid Updates
Part of the reason you’ll need to send your FAFSA to schools your child is considering applying to is because schools, not the government, send out financial aid packages. As such, each school your child applies to may offer a different financial aid package.
25. Skipping Information Can Be Costly
Before hitting submit, you might want to double check that every section of the FAFSA is filled out (and accurate). Skipping FAFSA sections may result in delays in your application being processed, errors that prevent you from submitting, or even a decrease in the amount of aid offered.
26. Your Child Will Need to Take Student Loan Exit Counseling
While filing FAFSA or talking to your school’s financial aid office, you may hear about something called student loan exit counseling. This is mandatory for anyone who gets federal student loan aid. Counseling is simply an online module that will help your child navigate how the student loan repayment process works. A reminder will be sent to your child’s email in their last year of school about when this exit counseling is due. However, you and your child may want to consider reviewing student loan exit repayment options before the counseling is due to ensure they pick the best option based on their financial situation.
27. File Early to Get the Most Aid
While it may seem like you have a ton of time to fill out the FAFSA, it may be best to complete it sooner rather than later. Delaying can mean financial aid for your state or school dries up before your child can even be considered for it. Additionally, knowing how much aid each school is offering your child may help them when deciding on which school to attend.
28. You Could Be Selected for FAFSA Verification
After your child receives their student aid report, they may get a message saying they were selected for verification. FAFSA verification is used by some schools to simply verify that students’ FAFSA information is accurate. Some schools randomly select people to be verified, some verify all students, and some may elect not to verify any students.
Recommended: 14 Must-Know College Financial Aid Terms for Parents
29. You Can Appeal Your Aid Package
Once your child has their financial aid packages, they may find that they were offered less than they expected or hoped for. If your child’s dream college didn’t offer enough aid (or perhaps even didn’t offer them any aid), they may be able to appeal for more financial aid. This process may be especially important if your financial situation has changed since you and your child first applied for FAFSA. While schools may deny the request, it doesn’t cost you or your child anything but time to ask for more aid.
30. You Can List Unusual Circumstances That Affect Your Finances
Another way to try and increase your financial aid package is by listing unusual financial circumstances both on your FAFSA and in an appeal letter to schools you’re applying to. Some common unusual circumstances include (but are not limited to):
• Having tuition expenses in elementary and/or secondary schools
• Experiencing unusual medical or dental expenses not covered by insurance
• Having a family member become unemployed recently
• Experiencing changes in income and/or assets that could affect aid eligibility
31. You’ll Have to Reapply Every Year
Once you’ve filed your FAFSA, you may want to keep your login information in a safe place. You’ll need that information to file for FAFSA every year your child is in school, and losing your FSA login information may delay your ability to apply next year. You may also want to set a reminder on your phone or calendar to apply next year, although FAFSA will send you an email reminder when next year’s FAFSA is open.
The Takeaway
Filing for FAFSA is an important first step in helping your child pay for college. Knowing how FAFSA works and how to optimize the amount of aid your child receives can help increase the amount of federal aid they’re offered.
However, if their financial aid package isn’t enough to cover college costs, they may want to consider private student loans. Private student loans aren’t required to offer the same borrower protections as federal student loans, and are, therefore, generally considered as an option only after all other sources of funding have been exhausted.
If you’re considering private loans to pay for college, you may want to review the differences between private and federal student loans to ensure that you and your child choose the best options for them to pay for college. SoFi offers private student loans that have no hidden fees and allow borrowers to choose between four repayment options.
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