For prospective college students and their parents, it’s time to knuckle down and apply themselves, literally, by filling out the Free Application for Student Aid (FAFSA). The FAFSA for the 2024-25 award year will be available by December 31, 2023 (delayed from the more usual October 1 release date.). Every high school senior should fill out this application, even if they are not sure if they are eligible for aid.
The FAFSA is the key to unlocking need-based grants, work-study allotments, federal student loans, and even some institutional aid and scholarships. Some needs-based aid may be offered on a first-come first-served basis, and submitting the FAFSA sooner rather than later could increase your chances of qualifying for funding while it’s available.
Don’t wait. A study by NerdWallet found that the high school graduating class of 2018 missed out on $2.6 billion in available federal aid for college because eligible students did not complete the FAFSA. The December opening date means the FAFSA launch could coincide with school breaks and holidays, but don’t put off completing it.
Because of the delayed release, colleges won’t start getting FAFSA information from prospective students until late January 2024, which could delay delivery of financial aid packages and shorten families’ college decision-making timeline. The crunched timeline makes it even more essential to submit the FAFSA once it opens.
Fewer Questions
The new FAFSA is reduced to 36 questions (from the previous 108), including detailed financial information, and it is easier to import income data from tax records. Applicants will be able to skip some questions, depending on their circumstances. For example, a drug-related conviction alone will no longer disqualify applicants, and that question won’t be included on the FAFSA.
Along with the pared-down form, the Department of Education is changing its formulas to determine who will qualify for aid and how much they’ll receive. The objective of the redesign is to expand financial assistance for low-income families.
All contributors must agree to allow the IRS to directly import their federal tax information to the FAFSA. The direct data exchange will make it easier for families to fill out the form, since they won’t need to dig up their tax returns and manually enter this information. While a student can still submit their FAFSA if any contributor doesn’t consent to this process, they won’t be eligible for federal student aid.
This recent FAFSA overhaul puts into practice laws enacted in the FAFSA Simplification Act, part of the Consolidated Appropriations Act of 2021 and amended by the Consolidated Appropriations Act of 2022.
Smoother, But Still Some Wrinkles
The goal is to make the process easier, but the path is not without complications. Because the new form will only be available by December 31, about three months later than usual, applicants will have less time to complete their forms. There are also new formulas emphasizing savings instead of income in determining aid amounts.
The most important changes include:
- FAFSA won’t open until December 31, instead of the usual October 1. The later start will cut the time families have to submit the FAFSA, which will still have a final deadline of June 30, 2025. That may seem to be a long deadline, but it can become an issue when states and individual colleges set their own deadlines, separate from the federal deadline. Some of those are as early as the January after the FAFSA release.
- With the new FAFSA, each contributor will need a unique ID (account username and password combination) to log in and complete their portion of the form. Contributors could include the student, the student’s spouse, a biological or adoptive parent, or the parent’s spouse. There’s a turnaround time of up to three days between requesting your ID and receiving it. You won’t be able to submit the FAFSA until every contributor has their ID.
- Students no longer must register for the Selective Service in order to complete the FAFSA, and the question will be removed from the application.
- If parents are divorced or separated, the parent who provided the most financial support in the last calendar year will now complete the FAFSA.
- The number of students a family has enrolled in college will no longer factor into the FAFSA calculation.
- The Expected Family Contribution becomes the Student Aid Index and will still be subtracted from the cost of attending to determine how much aid you might need, but it will no longer be divided by the number of students a family has in college. That means most families with more than one student in college will be eligible for less financial aid.
- Income protection allowances, which cover a family’s basic daily living expenses and are excluded from the financial aid eligibility formula, will be larger.. Larger allowances lower the income students and parents can contribute to college expenses, which will increase their financial aid eligibility. Allowances will increase by 20% for parents, up to about $2,400 (35%) for most students, and up to about $6,500 (60%) for students who are single parents themselves.
- The Pell Grant is the federal government’s primary grant aimed at low- and middle-income students, helping more than six million students afford college in the 2021-22 school year. The need-based Pell Grant gives students free college aid that doesn’t need to be repaid. With the new FAFSA formula, 610,000 additional students from low-income backgrounds will be eligible for Pell Grants who wouldn’t have been under the previous form. Additionally, 1.5 million students will be newly eligible for the maximum Pell award: $7,395 per year.
Here are some key changes to know about how the new FAFSA treats Pell calculations:
- Maximum annual grants will be awarded based on family size, adjusted gross income, and poverty guidelines.
- The Student Aid Index (SAI) is an eligibility index number that a school’s financial aid office uses to determine how much federal student aid the student would receive if the student attended the school. This number results from the information that the student provides in their FAFSA form. Students who don’t qualify for the maximum Pell Grant could still receive funds if their SAI is less than the Pell Grant maximum.
- If a student’s SAI is greater than the maximum Pell Grant award, they could receive a minimum grant award if they qualify based on family size, adjusted gross income, and poverty guidelines.
Conclusion: Don’t Wait
Sign up on StudentAid.gov for an email notification when the form comes out. Try to submit the form as soon as possible after it launches. The revamped Federal Student Aid Estimator on the website can also help you gauge how much aid you’ll receive.
I’m not sure if this is the right word — but I thought it needed another noun in the phrase.
How can they complete it before the new year if it’s not coming out until Dec 31?
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