The Free Application for Federal Student Aid, or the FAFSA, is the one-stop application for aid from the federal government, state governments, and colleges you want to attend. Every year, the Federal Student Aid office provides more than $120 billion in federal aid and loans to help students across the country pay for college. Some scholarships and other funding options also require you to submit the FAFSA as part of the application process.
Common misconceptions about the FAFSA cause millions of students to leave free college funding on the table each year. One in three high school seniors and their families do not complete the FAFSA because they think they won’t get any financial aid, aren’t interested in student loans, or are confused about the application.
However, the majority of students do qualify for some type of financial aid, which includes gift-aid like grants and scholarships payday loans South Dakota alongside the work-study program and low-interest student loans. Nearly 90% of full-time students pursuing their first degree use federal financial aid to pay for college, and completing the FAFSA is the first step in applying for these funds.
As tuition costs continue to rise, securing financial aid remains one of the most important factors in being able to attend college. The process can seem daunting at first – that’s why we’ve created this guide to help you figure out how to apply for financial aid, what kind of funding you might get, and how to use financial aid to minimize student debt.
- Free Application for Federal Student Aid, the one-stop application for aid from the federal government, state governments, and colleges you want to attend.
How Does the FAFSA Work?
The FAFSA asks for information about your income, family size, how much money you have, and other factors that help determine your aid eligibility. It also asks which schools you want to receive your aid application.
The U.S. Department of Education sends your FAFSA to each college you listed, and these schools use it to determine how much financial aid you qualify for. This calculation is based on the cost of attendance (COA) at that school and your Expected Family Contribution (EFC), or how much you and your family can afford to pay.
In order to receive a financial aid award, you’ll need to be accepted to the college, but you can still list a school even if you haven’t applied yet. Each school you are accepted to will send you a financial aid award package to tell you how much gift aid, work-study funding, and federal student loans you can receive if you choose to enroll at that school.
Many incoming undergraduate students are considered dependent, which means their parents’ income will be factored into their aid eligibility. Students who are older than 24, married, have children, or enroll in graduate school are considered independent, and their aid eligibility is based only on their income. Both types of applicants can get financial aid.
What is Expected Family Contribution (EFC)?
The Expected Family Contribution (EFC) is one of several factors – along with your enrollment status, your year in college, and the total expense of attending your school – that is used to calculate how much federal financial aid you are eligible to receive. Your EFC is determined by the answers you provide in the FAFSA form regarding your (or your parents’) income, assets, family size, and the number of family members attending college. If your or your parents’ income is less than $27,000, your EFC is automatically set at 0. However, if you are an independent student, you must have dependents other than a spouse to qualify for the zero EFC.