There are a few tips you can follow to make the FAFSA work better for you:
Use A Supplementary Letter
When you are filling out the FAFSA, the application asks you somewhere around 100 questions (it is time consuming). However, not many of these questions have to do with what is going on with your finances currently. The questions have to do with the prior year’s finances. This means things like a recent job loss, recent illness and medical bills are not taken into consideration. You can write a letter to the university in which you plan to attend explaining your current situation. This will require a third-party document as well (hospital bills, doctor’s note, layoff notice), but it can significantly help your likelihood of receiving aid.
Always File
Even if you don’t think you will get any kind of federal aid, you should file. If you household makes $180,000 or less a year, you will likely qualify for some type of student aid. If you do not file for student aid, you can be blocked from asking for it for a few years. This can be bad if you have a financial bump in the road and are not able to pay out-of-pocket for your education. Besides, you have to fill out the FAFSA prior to receiving any type of federal loan, so go ahead and fill it out.
Savings Accounts
If you have a savings account in your name (student’s name), move the money. FAFSA takes the student’s earnings, savings and income into consideration before their family’s. This means that if you have a college savings account, brokerage account or any other type of savings, it may be considered when the decision about your eligibility for aid is made. This can be avoided if parents can just move the savings into their account or start the college savings in their name instead of having a child-owned account. You can also just use the savings for the child’s freshman year in college so that the savings are no longer taken into consideration when filling out the FAFSA.
File Early
The earlier you can file, the better. If you can get the FAFSA filed before the end of January, that is best. Some schools (and even entire states) award federal student aid money on a first come, first serve basis. States like North Carolina, South Carolina, Kentucky, Illinois, Tennessee, Vermont and Washington have all handled federal aid disbursement this way. If you live in or go to school in one of these states, it is important to get your FAFSA in early because they will only disburse funds until they are depleted.
Complete The FAFSA
To be accepted for student aid, you have to completely fill out the FAFSA. You can’t leave anything out. If you leave information out, you will be prompted to re-do the application and it will take longer for your financial aid to be processed.
Photo: Flickr: Tax Credits
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