Everything You Need to Know About FAFSA

Each year, the U.S. Department of Education distributes more than $150 billion in grants, loans, and work-study awards to millions of college students. With these financial aid programs, tuition, room and board, books, and other college-related expenses can become more affordable for many families. To determine if your student qualifies for these federal funds, you must fill out the Free Application for Federal Student Aid or FAFSA.

Documents you need for the FAFSA

Before applying for the FAFSA, it’s a good idea to gather the documents and information you’ll need to apply. The documents include the following:

  • Your tax returns and W-2 forms
  • Records of untaxed income, such as child support and interest income
  • Records of assets, like savings accounts and investment accounts
  • Social Security numbers of your student and both parents

How to Submit the FAFSA

Once you’re ready to apply for the FAFSA, follow these steps:

  1. Visit www.fafsa.gov or download the myStudentAid mobile app.
  2. Create a Federal Student IDA or FSA IDA.
  3. Answer each question thoroughly and accurately.
  4. List the colleges, technical schools, or universities your student is considering.

Be sure to submit the FAFSA before the deadline. This deadline for the 2022-2023 school year is June 30, 2023. The sooner you fill out the form, the more likely your student will receive all the aid they may be entitled to.

What happens after the FAFSA is submitted?

If you complete your FAFSA application online, the Department of Education will take 3 to 5 days to process it. Then, you’ll receive a student summary report (SAR) and an estimate of what your family is expected to contribute (expected family contribution or EFC) towards your student’s education. FAFSA will share the SAR report with up to 10 schools your student applied to.

 

Next, the financial aid office at each college, tech school, or university will consider these factors to calculate your student’s financial aid:

  • Your student’s cost of attendance (COA). The COA is an estimate of tuition and fees, room and board, books and supplies, etc.
  • Your Expected Family Contribution (EFC). The EFC is based on a unique formula that involves your family’s taxed and untaxed income, assets, and benefits.

The financial aid office will subtract the EFC from the COA to determine the amount of need-based financial aid your student needs and how much they can receive.

 

Consult Your Financial Professional

Your financial professional can help you fill out the FAFSA and answer any questions you might have. In addition, they can help you design a strategy for funding your student’s higher education.

Important Disclosures

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by Fresh Finance.

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