Don't sleep on financial aid: Fill out the FAFSA
We’ve heard this comment before: “Why would I fill out the FAFSA? I know I won’t qualify for financial aid anyway”.
This can be one of the biggest mistakes for a family when paying for the cost of college for their child.
October 1st should be a date marked on the calendar of all parents with students in college next fall. It signifies the first day to fill out the Free Application for Federal Student Aid or “FAFSA” to apply for federal student aid.
Why should all college students fill out the FAFSA? It’s not just used to determine federal grants; it’s also used to determine eligibility for federal loans and work study arrangements. Even if you won’t qualify for federal grants (financial aid that doesn’t need to be paid back), most families do qualify for federal loans which traditionally have better rates and flexibility than loans from private lenders.
It’s essentially a no loss decision to fill out the FAFSA. It’s free to fill out, and traditionally takes less than an hour, but can save you thousands of dollars on the cost of college if you receive need based grants.
What’s the rush to get it done October 1st?
Financial aid is traditionally handed out by colleges on a first-come first-serve basis. The earlier that you submit your FAFSA, the greater the chance that you’ll be able to maximize your potential for aid, as colleges tend to use up their aid as the year goes on.
Due to the uncertain current environment, it may be especially important to fill out the FAFSA this year. As some schools report lower enrollment numbers, they may be forced to be more generous with their financial aid than in years past in an effort to attract more students.
How do you get started? Just click this link to get to the official Federal Student Aid site. From here, you’ll need a few documents including your 2020 tax return and some other additional financial information.
The FAFSA may not be the only form that you may be filling out. Many private colleges and universities require you to fill out the CSS Profile which can be found here. The CSS Profile takes a more in depth look than the FAFSA and you’ll need to review which forms (or both) are required by the schools on your list.
Some folks may be comfortable filling these forms out themselves (especially true if one does their own taxes each year) however, it is easy to make mistakes that can cost a family a lot of money. We are happy to help our clients in this area so if you would like to discuss how that would work, please feel free to reach out.
All the best,
Andrew Holmes, Certified College Planning Specialist™
Pictured above: Tully Holmes taking a nap instead of filling out the FAFSA
Check out my recent whitepaper: 5 College Planning Mistakes to Avoid
Revised since originally published: Sept 15th, 2020
Financial Planning Solutions, LLC (FPS) is a Registered Investment Advisor. Financial Planning Solutions, LLC (FPS) provides this blog for informational and educational purposes only. Nothing in this blog should be considered investment, tax, or legal advice. FPS only renders personalized advice to each client. Information herein includes opinions and source information that is believed to be reliable. However, such information may not be independently verified by FPS. Please see important disclosures link at the bottom of this page.