Every year, college-bound families stress about filling out the Free Application for Federal Student Aid, a.k.a the FAFSA. Available on Oct. 1, the FAFSA is the form the U.S. Department of Education uses to determine who’s eligible for federal financial aid to help pay for college.
Sometimes families skip filling out the application because they assume they won’t qualify for aid, or they don’t finish it because they find the process confusing.
But besides being the gateway to more than $38 billion in federal grants, colleges use the FAFSA to determine state aid, institutional aid, work-study awards, federal student loans and sometimes merit scholarships. In other words, neglecting the form means you could be passing up on cold, hard cash to help you pay for college. Plus, there’s free help available for those with more complicated situations.
While there are big changes coming to the form, likely next year, this year’s edition will look much like it has in recent years. Here’s what students and parents need to do to complete the aid application.
1. Plan to file well ahead of the federal deadline
Though the FAFSA opens up each year on Oct. 1, that’s not when it’s due, so don’t panic. The federal deadline actually isn’t until 21 months later. So, for example, the FAFSA for the 2023-2024 school year will open on Oct. 1, 2022 and close June 30, 2024.
However, states and colleges have much earlier FAFSA deadlines for their own aid, and some states award aid on a first-come, first-served basis. The upshot? While it’s not necessary to file exactly on Oct. 1, you do want to file early. Jodi Okun, founder and president of College Financial Aid Advisors says, “Make sure it’s before the priority financial aid deadline of the colleges.”
2. Create your Federal Student Aid ID and Save Key
You’ll have to fill out the application online at studentaid.gov, as the mobile app has been discontinued.
Before you can start the FAFSA application process, you must set up an account with a Federal Student Aid ID, which requires a student’s Social Security number or alien registration number. It takes one to three days to confirm your account, so start this process several days beforehand.Your FSA ID is a username and password for your account. It also acts as your electronic signature when you submit the FAFSA online. This video will guide you on setting it up.
One parent also needs to set up a separate FSA ID if you’re a dependent student. The parent’s FSA ID is solely to sign electronically, and it requires their Social Security number, a separate email address, and a separate phone number from the student's. (The same parent FSA ID can be used for multiple kids in college.) If your parent doesn’t have a Social Security number, they can’t get an FSA ID. They should instead insert zeros in place of their Social Security number and print the signature page at the end to sign and snail mail.
You’ll use the same FSA ID every year you fill out the FAFSA. It can be reset if you forget your password or username, but the FAFSA locks you out after three attempts to sign on — so reset before that third try. Returning users can log in and hit “FAFSA renewal” to populate the personal information from last year’s form.
You’ll also need to create a “save key,” which is a temporary password (different from your FSA ID) that allows sharing the document between parent and student until it’s submitted. Make sure to write down your FSA IDs and save key; everything is easier if you don’t forget them.
If you’re the parent of a dependent student, you can fill out your portion of the aid application without your student’s FSA ID. On the Login page, enter your student’s name, Social Security number, and birth date on the right-hand side along with the save key your family created. You cannot use your FSA ID to log in — only the student’s FSA ID works. It’s their FAFSA.
3. Add your list of schools
There’s a section on the FAFSA for listing up to 10 colleges. Your FAFSA gets sent to them at no cost, so list any colleges of interest even you haven’t applied or been accepted. You can add new ones later if needed. You’ll need to include the federal school code for each college you list, which you can find here.
If you want to list more than 10, wait until you receive your Student Aid Report (more on that below) confirming the FAFSA application was processed and sent to the first 10, says Alex Bickford, director of college finance at Bright Horizons College Coach. Then you can log back in and delete all 10 schools and add the new colleges, he says. To get there, click on “Make FAFSA Corrections” and go to the schools section.
4. Gather your financial documents before filling out the form
You’ll need the previous year’s tax return to file for next year — that is, you’ll use your 2021 tax return for the 2023-24 school year.
Dependent students must provide their financial information and their parents’ information. Independent students provide only their own information (along with their spouse’s if married). Here’s what to collect in advance:
- Driver's license (if you have one)
- Federal income tax returns (if filed) and W-2s from the previous year
- Nontaxable income records, such as child support and veteran benefits, from the previous year
- Bank statements showing your most recent asset information, including checking, savings, non-retirement investment records, parent-owned college funds, real estate (but not your primary home), business records, investment farms, and student accounts such as UTMA or UGMA accounts.
If a parent’s income situation has changed — because of a job loss, for example — you’ll still use the same tax return. After filing the FAFSA, contact each of your colleges to discuss your family’s changes and how to document them.
5. Fill out all FAFSA sections
First, choose the correct FAFSA year. You’ll see two options, one for the current academic year and one for the next year. You want next year. Then complete each section.
Be sure to check the box that you want to be considered for work-study. Doing so simply gives you the option to use it if it's awarded. Down the road when you get your financial aid award, you don’t have to accept it if you don’t want to.
Many families qualify to use what’s called the IRS Data Retrieval Tool (DRT) to populate the student and parent income sections. You’ll see a “Link to IRS” button if you’re eligible to use the tool. The DRT populates tax return information directly from the IRS.
Experts recommend using the tool because it’s safe, fast and accurate; it eliminates the chance you might make a mistake when entering your financial information. But note that the FAFSA form won’t display numbers — only the phrase “Transferred from the IRS” — so you won’t be able to verify numbers against your tax return.
While the tool to retrieve data from the IRS has been a big help in simplifying families’ interaction with the FAFSA, there are a couple of DRT caveats:
- Divorce: Don’t use the DRT if you’re in the process of divorce or separation, Bickford says. The FAFSA only requires information from the parent the child lives with more than half of the year (even if just by a day or two). That parent should manually enter their income and an estimate of their taxes paid.
- IRA rollover: When you use the DRT, be sure to watch for the FAFSA question asking if you had a rollover. The FAFSA subtracts the value of the rollover from your income. However, sometimes families miss the question, Bickford says, and then your rollover isn’t subtracted. That mistake artificially inflates your income, and consequently the amount a college thinks you can afford to contribute.
6. Watch out for common mistakes
The language on the FAFSA is formal and, frankly, bureaucratic — much like you’d see when filling out a tax return. So, take your time reading each question carefully to avoid making simple mistakes, especially if you have a complex family situation or tax return. Use the FAFSA’s question mark icons next to each line item to ensure you understand which assets should be reported.
Three common mistakes include listing a parent or student-owned 529 college savings account as a student asset, reporting retirement account balances (money in a 401(k), IRA or Roth IRA, for example), and including the home equity value of your primary home.
The 529 accounts should always be listed in the parent section, Bickford says. You’ll need to list the total of every 529 account you own even if they are intended for other children (but don’t include 529 plans owned by grandparents or other relatives). Also, don’t report qualified retirement accounts or the home equity of the house you live in — those assets are protected in the formula to calculate what you can afford to pay for college. Keep in mind, if you have money intended for retirement stashed in a non-retirement account, you do need to report that.
7. Check your work before you submit the FAFSA
This may sound like a silly step, but it’s an important one: Making corrections after you submit the aid application can be a pain and may even delay your financial aid notification. Save often as you fill out the form and save at the end. Proofread all your information and look for extra zeros. Once you’ve submitted your FAFSA, look for a confirmation screen indicating it went through.
The confirmation page also allows transferring information to a sibling’s FAFSA. Additionally, some states have their own financial aid form and partner with the FAFSA to allow you to transfer your information into the state form. Both of these options appear only on the confirmation page and must be used when you’re still in the form, so take advantage of them. If you don't, you’ll need to fill out those additional forms separately.
8. Review your Student Aid Report and make corrections if needed
If you submit the form electronically as most families do, your Student Aid Report should come back in three to five days — or two weeks for a paper signature page (either process takes longer if you submit without including an email address). But right after submitting the form, you can log in to confirm your application is processing properly.
The Student Aid Report is a summary of all the information you submitted. However, if you used the IRS Data Retrieval Tool, it won’t show your tax information. The SAR also lists an "Expected Family Contribution,” or EFC, in the top right corner of the page. Your EFC is the key to all financial aid.
Many parents are shocked by their Expected Family Contribution. But the name is a bit of a misnomer — it’s not necessarily the amount you’ll pay (indeed, you could pay much more). Instead, colleges use the EFC to determine how much financial aid you’re eligible for from federal, state and institutional sources. For federal financial aid, your financial need is equal to a college’s cost of attendance minus your EFC. Keep in mind, if your EFC is very low, many colleges don’t offer enough financial aid to meet need.
(Bonus tip: the EFC gets posted in an odd way. If your EFC is $8,000, for example, the SAR lists it as 008000.)
Note that the Student Aid Report is not the same thing as a financial aid award letter, which comes after you’ve been accepted to colleges. Those letters (from the colleges themselves) will break down the financial aid package a college is offering.
When your Student Aid Report is ready, you’ll receive an email notification to log in, review, and correct or update mistakes if needed. If your SAR is incomplete, you won’t see an EFC listed. Some corrections can be made online, but usually updates to your financial information or dependency status and marital status require contacting each college directly. If you used the Data Retrieval Tool, you cannot update any of that income information, Bickford says.
After you receive the email notification that your SAR is available, “Log in and see if you can make the corrections in the FAFSA,” he says. “You’ll know if you can’t because the box on the FAFSA will be grayed out.”
9. Follow through on the verification process if selected
Unfortunately, this is not the end of the FAFSA application process for every student. As many as 20% of applications each year are selected for a process known as verification. Don’t assume this means you made a mistake; some students are selected at random, and sometimes colleges verify all students’ FAFSAs before giving out financial aid packages.
Each college financial aid office handles verification on its own, but you’ll likely be asked for additional forms to support the submitted information — like a copy of your tax return if you didn’t use the DRT. You might see a notification posted on your Student Aid Report when you log in to review it, or you might be contacted directly by one of your colleges. Submit the information in a timely way to avoid delays in accessing your financial aid.
For most families, the FAFSA is a straightforward process that doesn’t take too much time. Data from the U.S. Department of Education show that most applicants complete the form in less than an hour. If you want to practice, this paper worksheet can help. And if you need help while you’re filling out the form, you can review the FAQs on the fafsa.gov website, use the chat function or call the helpline at 1-800-433-3243.