What is the FAFSA?

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Welcome back to Cox Collegiate Planners!

As a College Planner and CERTIFIED FINANCIAL PLANNER™, in Dallas TX, I'm acutely aware of how stressful it can be to apply for college. Students and parents alike can both quickly become completely overwhelmed by the number of applications, forms, and deadlines they're given. Just getting acquainted with some of these processes and forms can help put the mind at ease just a little bit. By understanding what you're doing and why you're doing it, you're removing the ambiguity of the tasks you're performing, which can help keep everyone motivated. 

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In this blog post, we're going to be talking all about one of the most (seemingly) overwhelming forms you'll fill out… the FAFSA. It's the one that everyone loves to hate and anxiously anticipates. With all of the negative attention the FAFSA gets, it's genuinely one of the most crucial college forms you'll fill out and can have a significant impact on your financial and college plan. So what is it? What does it do? How do you do it? And Why do you do it? We're going to get into all of those questions and more through this post as we methodically deconstruct the FAFSA.  

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The FAFSA

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The FAFSA stands for the Free Application for Federal Student Aid. It's the mother of all forms when applying for and receiving financial aid from the federal government, whether that aid is in the form of a federal grant, loan, or work-study program. Like the name states, filling out the FAFSA is free, and it takes approximately half an hour to fill out - that's not that bad. Not all, but a lot of states and schools require filling out the FAFSA for their own aid, grants, and scholarships.

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While the FAFSA does get a rough reputation for being long, arduous, and annoying to fill out - they've done a lot in recent years to make it easier for students and parents. For starters, most people fill out their FAFSA entirely online. While some prefer to still use the classic pen and paper, filling out online saves trees and time. The Student Aid website also provides helpful hints and tips along the way in their online application, which many students and parents find largely beneficial. Through their website, Student Aid also offers tons of resources, like blog posts, videos, and FAQs, which help expedite everything quite nicely. 

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Perhaps the nicest addition to the FAFSA in recent years is the ability to electronically transfer tax information from the IRS by using the IRS Data Retrieval Tool. By linking your FAFSA account to the IRS, you'll save a ton of hassle and legwork when it comes to finding and transferring numbers between tax returns and your application. Later on in this post, we'll also talk about FSA IDs, which can be used to electronically sign and verify your FAFSA application, which also serves to hurry things along. 

Who Should Fill Out a FAFSA?

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Most schools are beginning to require all students to fill out the FAFSA. This serves both the school and the applying student in a few ways. For starters, this helps you knock out two birds with one stone by applying for federal student aid and the school's student aid in one swoop. This allows students and schools to cut down on the number of forms that have to be filled out and processed. If you're a new student applying for a college or university, you should likely be filling out the FAFSA whether you "need to" or not. If you don't apply, you don't know how much money you're potentially leaving on the table in the form of aid. And college is expensive, so there's no need to leave money on the table if it's available. 

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If you're a returning student, you should also take the time to fill out the FAFSA. Typically, if you're in school and need to fill out the FAFSA, you'll be prompted or reminded by your university. However, this isn't always the case, and you'll need to renew your FAFSA each year to remain eligible for federal student aid. Outside of those broad strokes, you'll need to fill out FAFSA if you'd like to receive federal student aid in the form of grants, loans, or work-study programs. Some scholarships also require applicants to fill out the FAFSA. All in all, if you're going to college - you should more than likely be filling it out. 

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Financial Situations can change over time

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Like it or not, life will throw us unwelcome curve balls. Job Loss, Divorce and Death are unplanned life events that can drastically change a family's finances. Forgoing filling out the FAFSA form tells the schools that you are willing to pay full price tuition for your student's entire academic career. By filling out the FAFSA, even if you do not currently qualify for need based aid, you are setting the stage for making your case to the financial aid offices if your situation does change.

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When Should the FAFSA be Filled Out?

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Some said that it's available by filling out the FAFSA is first come, first serve. This means that the sooner you apply, the more likely you'll be to receive money that could help you pay for college! For 2020-2021 and 2021-2022, the FAFSA became available to fill out on October 1st. Filling the application out as soon as possible helps you qualify for as much aid as possible. Many feel they're unable to fill out their FAFSA because it often requires tax information. However, you can always fill it out with estimates based on the most recent year's tax information and come back to edit/revise it later on

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While getting the FAFSA in as early as possible is best practice- we're not all going to do that. Some of us won't be aware of the FAFSA for whatever reason, which could delay when we get to it, and some of us… well, some of us are just procrastinators. The latest you can fill out the FAFSA will likely depend on which school you're attending, as each school has its own specific deadlines. Some states also set their own deadlines, which would affect when you'd need to have it in. However, the FAFSA can be completed and submitted at any time during the award year or the year that aid will be received. 

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To check your state's FAFSA submission deadline by school and state, you can visit the student aid website here. 

Before You Fill Out the FAFSA, Get Your FSA ID

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I recently wrote a blog post detailing what an FSA ID is and how to get it. If you haven't had the time to check that blog post out, I'll briefly go over that information.

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FSA ID stands for Federal Student Aid Identification. An FSA ID allows you to submit forms, like the FAFSA, by creating a separate profile that can be used to sign in and provide a digital" signature." An FSA ID is easy to make! All you have to do is visit the Federal Student Aid website and create an ID.

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While you don't need to create your FSA ID before you start the FAFSA, you'll need to do it before submitting your financial information. I recommend making your FSA ID as a first step, as it keeps you from having to backtrack and create it later. Having it handy and ready to plugin will ensure you can submit your FAFSA when you've completed the form. This eliminates the possibility of forgetting to submit or losing your progress, and having to restart. 

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Having your FSA ID will also help you renew your FAFSA each year by saving information you've already submitted. This is critical - keep in mind that your email address, social security number, and phone number can only be linked to ONE FAFSA account. Verify your email, phone number, and input good security questions that you'll remember if you forget your username or password. If a parent needs to input any information, like taxes, they'll also need a separate FSA ID. Keep in mind that it's not a good idea to mix profiles with parents and student information. This can lead to issues down the road that may delay your ability to submit your FAFSA and other applications.

How to Fill Out the FAFSA

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With your FSA ID created and ready to go, navigate to the FAFSA website here. Before you begin, you'll also want to gather your social security card, driver's license,W-2/other tax forms, and your permanent resident card (if applicable). Once you have all of that ready to go, you'll be prompted on FAFSA's homepage to "Start Here" if you're a new user or "sign in" if you've already begun or filled out a FAFSA in a previous year. Next, you'll start filling out the FAFSA in three parts: personal information, financial information, and parent information. 

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If you have all of your information ready to go, this part should actually go reasonably quickly! Coupled with the ability to import tax information by linking your profile to the IRS website, the documents you gathered should make filling out the FAFSA a breeze. 

What Aid Does the FAFSA Offer?

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Filling out the FAFSA opens you up to grants, loans, and work-study programs. Let's briefly describe each type of federal student aid that you may receive if you fill out the FAFSA.

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Federal Grants

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Federal Grants are a type of aid provided to a student that doesn't require repayment. These are fantastic. Grants like the Pell Grant or the Federal Supplemental Educational Opportunity Grant are awarded to students working on their first bachelor's, graduate, or professional degrees. 

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Federal Student Loans

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Federal Student Loans can help bridge the gap between what you can pay and what you need for school. These do require repayment and have stipulations, like the inability to default should you ever declare bankruptcy. 

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Federal Work Study Programs

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‍Work-Study Programs are another way that students can bridge the gap when paying for college. These programs allow students to work while in school and minimize the amount of student loans they have to take out. Work-study is similar to a "normal" job, and you can use the money you earn however you want. 

Student Aid Report

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After you submit the FAFSA, your information will go to the Department of Education. If you filled out the FAFSA online, you'll be able to check on your application status in the process of being accepted. Next, you'll receive your SAR or Student Aid report. With your SAR, you can overview a simplified version of the information you submitted and revise or correct any tax information that you may have estimated. After you verify your SAR, your FAFSA will be forwarded to all of the schools you selected to receive your information.

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From there, schools will use your FAFSA and your EFC, or expected family contribution, to determine how much aid you're eligible for. The school or schools that accept your application will then send you an award letter. Your award letter will outline and explain the aid that you're eligible for. 

Where to Go if You Need Help with the FAFSA. 

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If you need help during the process of filling out the FAFSA or if you have any questions, there are a few great resources that can help clear things up! First, check out the Federal Student Aid and the FAFSA websites. There you can find answers to commonly asked questions about the process of filling out the FAFSA. On either of their websites, they offer links to informative blogs and videos outlining every step of the process in an easy-to-read/understand way. The FAFSA form also has a help button in the bottom right-hand corner of its webpage. This is a great way to answer questions you have about the FAFSA itself in real-time. You can also visit your high school's guidance counselor or contact the student aid office at the school you're applying for. Most of the time, these are excellent resources with knowledgeable personnel who know the answer to most questions about the FAFSA and federal student aid. 

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The FAFSA and Federal Student Aid also have beneficial resources for students (on platforms they use)! Both organizations have YouTube channels devoted to helping students understand the process of applying for federal student aid. Chances are, you can find an answer to the majority of your questions on either one of their channels in a digestible, bite-sized video. 

Cox Collegiate Planners can help you navigate the FAFSA process

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If you're a student or a parent of a student - keep in mind the key to the FAFSA is getting started. Getting your application in early can really help your chances of maximizing the amount of federal student aid available to you. If you have questions about the FAFSA, FSA IDs, or any other information discussed in this post, please feel free to reach out and give me a call or send me an email to schedule an appointment. Together, we'll develop an innovative, strategic, and forward-thinking plan to achieve financial success in higher education. 

Schedule a call with Melissa Cox CFP®

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Until next time… this is Cox Collegiate Planners!

Melissa Anne Cox, College Funding and Student Loan Advisor, is also a CERTIFIED FINANCIAL PLANNER™ and financial coach in Dallas, Texas.