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May 26, 2021

FAFSA: All You Need to Know for Filing

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Do you need assistance paying college tuition? That’s a valid concern, given the soaring cost of college attendance. Here’s what you need to know before we reach the deadline for FAFSA assistance.
 

What Is FAFSA?

FAFSA is the short name for the Free Application for Federal Student Aid. The U.S. Department of Education helps students to afford college by awarding grants, loans, and work-study opportunities based on financial need. Colleges in the United States use the information from the FAFSA to determine financial aid eligibility for students.
 
The federal government looks at financial information from items such as your tax returns to determine your expected family contribution (EFC). In other words, the EFC is the amount of money you should be able to pay to cover the cost of college.
 
Colleges use your expected family contribution to figure out how much need-based aid they will offer the student. For example, let’s say your EFC is fifty thousand dollars per year. A college with a cost of attendance of forty thousand per year isn’t likely to offer need-based aid.
 
The surest way to access federal student aid for college is through the FAFSA. Read on for information regarding meeting the deadline for FAFSA and information you need to know.


Access the FAFSA and Register for an FSA ID

Prepare to spend some time completing the FAFSA. The federal government distributes a massive amount of college financial assistance each year. You must complete the application accurately and on-time.
 
Start by accessing the application. Once you obtain the form, you’ll need to sign up for an FSA ID username and password. Both the prospective student and their parent (if applicable) should sign up for an FSA ID.
 
To receive a valid FSA ID, you’ll need the following:
 
  • Social Security number
  • Full name
  • Birthdate
  • Email address or cell phone number
 
Do you have questions about the FSA ID? Read here for complete details.


Fill Out the FAFSA

Once you have your FSA ID username and password, you can complete the FAFSA. Filling out the application isn’t too challenging if you have your paperwork handy.
 
Information you’ll need for the FAFSA includes the following:
 
  • Social Security number
  • Driver’s license
  • Federal tax returns
  • Untaxed income sources like child support
  • Total cash
  • Checking and savings accounts
  • Investments (excluding your primary residence)
  • Business and farm assets
 
To simplify this process, the FAFSA offers the Internal Revenue Service Data Retrieval Tool to transfer financial information for eligible applicants. This way, you can import information the IRS already has on file, if you don’t have tax information paperwork handy.
 
Along with your financial data, the FAFSA considers the size of your family and the number of persons attending college within your family. Find extensive information on how to fill out the FAFSA on the official government website.
 
Merely meeting the deadline for FAFSA isn’t enough. Next, you’ll need to connect with the financial aid department at the university you want to attend.
 

College Financial Aid

No doubt going to college is expensive. Between tuition, fees, books, and housing, the bill can be enormous. Fortunately, college financial aid offices work hard to make college attendance possible.
 
The first step in obtaining financial aid based on need is to share the FAFSA with your college. The financial aid office uses the FAFSA, particularly the EFC, to decide if you qualify for need-based aid.
 
Need-based financial help comes in the form of government loans, work-study, and grants. Many colleges also offer institutional scholarships to help make college affordable.
 
Don’t hesitate to contact the financial aid professionals at the college if you feel you need more financial help. Although money is often limited in many institutions, there is always the chance that your situation merits more consideration. Notify the college of a drastic change, such as a job loss, to your finances.
 

Private College Loans

Government-backed student loans are not the only source of funding available. Many families also take out education loans at banks and credit unions. These loans come directly from the financial institution and have varying requirements and interest rates.
 

Deadlines

Lastly, FAFSA deadlines vary for federal, state, and institutional aid. You only have to file the FAFSA once to be eligible for all three types of aid. The federal government gives students a deadline of June 30 after the school year in which they need aid — for instance, June 30, 2021, for the 2020-21 school year or June 30, 2022, for the 2021-22 school year. But, we recommend submitting your FAFSA earlier to meet financial aid deadlines for your state and college, and to get your aid dollars in time for the start of the school year.
 
Attending college is costly, and it makes financial sense to receive as much assistance as possible. Keep in mind that student loans are not free money. You must repay the loan. Never borrow more money than you can comfortably afford to repay.
 
 

Contents of this blog article are intended to provide you with a general understanding of the subject matter. However, it is not intended to provide legal, accounting, or other professional advice and should not be relied on as such. Information may have changed since the publication date.

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