Dunnan on Dollars Personal Finance Tips from Nancy Dunnan The FAFSA Form
July 3, 2010 -
As part of our ongoing series on paying for college, last week we discussed various steps parents can take to cut costs (click HERE to read). And, prior to that we outlined 10 things students can do to reduce the cost of a higher education (click HERE to read). This week we address the sticky issue of the Free Application for Federal Student Aid, usually referred to as the FAFSA.
When students apply to a college, they must fill out the FAFSA in order to get federal or state financial aid. In addition, a great many colleges require the form whether or not financial aid is needed.
The application is sent in during the student's senior year of high school and it must be renewed each year he or she is in college. You may be able to get a paper version, although these are no longer distributed in bulk to high schools, colleges and libraries, with few exceptions. But you can get up to three copies by calling 800-4-FED. The paper FAFSAs can be ordered starting November 1 of each year. The online version is at: http://www.fafsa.ed.gov/.
Applying on line has some distinct advantages. (1) The student will receive his/her Student Aid Report (SAR) sooner than with the paper form. (2) The FAFSA will be more accurate because the Web has built-in edit checks to catch common errors. And, (3) the online version allows students to list up to ten colleges; the paper FAFSA has space for only four colleges.
All college applications have a place to check off if financial aid is needed. Once the student has been accepted by a school and if the box for financial aid was checked, the college financial aid office will send details regarding what help is available. Among the options are work-study programs, subsidized and unsubsidized loans, Perkins loans, grants and scholarships.
If, for example, based on the FAFSA, it is determined that you can afford to spend $10,000 a year on college costs, the school will come up with a package of loans, grants, scholarship and work-study that cover the rest. If the student then gets another scholarship or grant (money that doesn't have to be paid back) for, say, $5,000, the school will adjust its package to be $5,000 less.
Filling out the FAFSA is almost as difficult as graduating with honors. The student will need records of income earned in the year prior to when he/she will start school. If the student is a dependent, then records of the parents' income are required.
Here's a list of the documents to have on hand when filling out the form.
- The student's income tax return
- The parents' income tax return(s)
- Social Security number
- Driver's license
- W-2s and other wage information
- Current bank account statements
- Current investment statements
The form cannot be filed until January 1. Keep in mind that many schools have very early application deadlines - some actually in January. Check the dates carefully. Note: If the school's deadline comes before you've done your current taxes, the FAFSA allows you to do an estimated calculation.
A word about local scholarships
Many students and parents are unaware that money for college may be sitting in their back yard. Begin your search by asking your student's guidance counselor for advice. Local aid comes in all shapes and sizes. For example, ethnic social groups, such as Greek, Russian, Polish and Italian, often help students. If you can trace your roots back to the country's early English settlers, look for money provided by the Daughters of the American Revolution. And then there are local businesses and organizations.
Many high schools make the search process fairly easy by administering all or most of the area's scholarships through a committee. That way, the student fills out only one application, then the committee culls what's available and matches the applicant with the sources that are most appropriate.
And, don't hesitate to do your own online search, using such phrases as "scholarships for college," "scholarships for women," etc.
For further information
Well-informed counselors are available by phone at the Federal Student Aid Information Center. Call: 800-4-FED-AID. They will also answer your questions on the FAFSA web site (http://www.fafsa.ed.gov/). While you're on the site, take time to read the helpful FAQ section.
The best book on the topic is Kalman Chany's "Paying For College Without Going Broke" (New York: Princeton Review Books, 2010). Revised annually, this is indeed the bible in the field. - Nancy Dunnan
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If you want to suggest a column topic for Nancy, drop her a line.
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