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  1. Education
  2. Student Financial Aid

7 Legal Ways to Squeeze More College Aid From the FAFSA

Originally Published: Jan 06, 2015
Originally Published: Jan 06, 2015 Last Updated: Sep 21, 2016 5 min read
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Sarina Finkelstein (photo illustration)—Getty Images (1)

Filling out the Free Application for Federal Student Aid, the most important application for need-based college financial aid, may not seem anything like a fun Pokemon Go adventure. But hidden among its questions are treasures much more valuable than stardust. If you fill out the FAFSA correctly, you can dramatically increase your odds of winning scholarships, grants and low-cost forgivable student loans. Here is your seven-step cheat sheet to winning the FAFSA.

  1. Don't blow it off: The FAFSA qualifies you and your parents for lots of goodies - regardless of how wealthy your family is. Students from families earning more than $200,000 a year often qualify for need-based aid from private colleges, for example. And students from families earning more than that need to file a FAFSA to qualify for low-cost, forgivable federal student loans and aid programs that require the FAFSA but award aid without regard to family income, such as the Tennessee Promise free community college offer.
  2. Go online. You can print out a PDF and fill out the FAFSA on paper. But the online version uses skip logic, which makes it easier and faster. Also the online version will import your tax information, which speeds things up even more and reduces the number of questions you have to answer.
  3. Time it right. If you're in college right now and haven't filled out this year's FAFSA, it's not too late. You can fill out the 2016-17 form as late as June 30, 2017 and possibly qualify for aid retroactively. But don't use that flexibility as an excuse to procrastinate. If you're planning to attend college in the fall of 2017, fill out the 2017-18 FAFSA as soon after it becomes available Oct. 1, 2016 as you can. That's especially important if you live in one of the 17 states with early deadlines or “first-come, first-served” financial aid programs. Early FAFSA filers receive, on average, twice the grant money as later filers, calculates financial aid expert Mark Kantrowitz.
  4. Clarify your relationships. Questions 16 and 59 ask about the students’ and parents’ marital status as of the day you file the form, to see if both parents’ income should be counted as financial resources for the student. Divorced or separated parents should report only one parent’s income - the parent with whom the student spends the most time - only if the other parent does not live in the same house. In other words, if you’re in the process of getting divorced or separated anyway, you'll probably get more aid if one spouse moves out before you finish the FAFSA.
  5. Parents: Don’t brag. Some states and colleges offer extra aid to children of parents who haven’t earned college degrees. Questions 24 and 25 ask about the highest level of education your parents completed. So if one or both of your parents, attended community college, or even are just one credit away from a bachelor’s degree, make sure to fill in the dot only for “high school."
  6. Pay your bills first. Questions 41 and 90 ask about how much cash students and parents have in savings and checking accounts at the moment you are filling out the FAFSA. But notice that there are no questions on the FAFSA about your debts or bills. So if you’ve got a sufficient emergency cash reserve, use any extra cash to pay down credit cards, car loans, or other bills before you finish filling out the form, and report the newly lower cash amount on the FAFSA. Here's more expert advice on how to legally manage your assets to increase your odds of aid.
  7. Shield your investments. Questions 42, 43, 91 and 92 ask about the student’s and the parents’ investments. But many filers don’t realize that the value of any retirement accounts, as well as the home you live in, should not be included in these boxes. So if you’ve got a lot of money in non-retirement accounts, prepay your mortgage or plow some into Roth IRAs. One big advantage of Roth IRAs: You can take out your contributions (but not any earnings) tax-free to pay college bills

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This article was updated 9/20/16 to reflect new FAFSA deadlines and rules for the upcoming 2017-18 academic year.