As much conversation there is about the increasing burden of student loan debt and rise in tuition — there isn’t enough talk about the billions of dollars that students leave on the table each year.
There’s money out there for kids to go to college. Student’s just aren’t filling out the FAFSA to receive it.
Some students could have qualified for a Pell Grant of $5,645 during the 2013-2014. However, 47 percent of of high school graduates missed out on this free money because they simply didn’t apply for it.
After filling out the FAFSA, financial aid letters would be delivered just in the nick of time for college bound students to make their decision on which school to attend. It was discouraging to say the least, which is why many students forgoed filling it out. Even more felt it was a waste of time because they thought they wouldn’t qualify for anything.
Well, the government is trying to do something about the limitations of the FAFSA and now for the first time, you can now fill out your FAFSA starting October 1st and use your prior year’s tax return.
Why is this such a big deal?
For starters, you can get your information in early and have an aid letter in your hand before many students begin choosing which college they want to attend. Secondly, you don’t need to wait on your current tax return to be filled out before completing the questionnaire.
This is a relief to many who might have needed to log in after initially completing the FAFSA to update their tax information on their application. You can also use the IRS Data Retrieval Tool to automatically import your prior year’s return, which makes this process even easier.
Now for those of you who don’t think you need to fill out the FAFSA because you won’t qualify for aid — think again!
Seriously, there is no income cap for completing the FAFSA. Regardless of your socioeconomic status, completing the FAFSA is an essential part of the financial process for any college or university. You don't even need a cosigner like some private loan applications. Schools use this information to determine who is eligible for grants, work-study, and loans. The state also uses it to determine any state based aid you may be eligible for.
While income is a factor in the financial aid process, it’s not the only one. Some colleges and universities have their own bucket of funds or endowments and they award monies based on need, merit, or both. So just because you consider yourself to be middle class doesn’t mean you won’t qualify for any of the aid previously discussed.
Still, even with these changes more can be done!
As previously discussed, another deterrent for filling out the FAFSA is the lengthy questionnaire students are required to fill out each year. The current FAFSA is pretty long to say the least with over one-hundred questions.
A bill was introduced to Congress, The Financial Aid Simplification and Transparency Act, to deal with this issue. This bill proposes that the current FAFSA be reduced from it’s ten page format to just two questions related to family size and household income. The goal would be to make the financial aid process easier and give more students access to all of this free money left on the table each year.
Now what happens with this bill remains to be seen. The bill was introduced in January 2015 and it appears Congress has a lot more on the table to deal with before this bill even gets the attention it desperately needs.
Despite the hang ups with the simplification of the FAFSA, I say count your blessings.
You can now fill out the FAFSA earlier and you can use your prior year’s tax returns to help the state, feds, and colleges figure out how much aid you should receive. Don’t sleep on this opportunity to partake in some of this free money.
Many of you have been misinformed thinking you don’t need the FAFSA. Hopefully, this little bit of information will convince you otherwise.
The FAFSA is for everyone and now you can apply earlier and get a head start on that lengthy application process. We’ll just keep our fingers crossed on the possibility of a two question FAFSA in the future though.