Your FAFSA Answers...How Much Will It Cost You?

The FAFSA (Free Application for Federal Student Aid) form is your first step in finding out what college is really going to cost you. The answers you supply will:

1. determine if you qualify for Pell grants
2. allow you to be considered for college grants and scholarships (Check your state deadline).
3. automatically fill out free grant applications in some states
4. decide how much federal aid (loans, work-study programs) you qualify for

How Does FAFSA Determine How Much?

It is this number that will decide your eligibility for federal, state and college aid. No matter how high this number looks to you, DO NOT GIVE UP HOPE...because:

• Each school makes its own decision about what to award students.


• EFC numbers are artificially high because of federal needs guidelines- and schools take this into account.


• You can make corrections if any of your information is wrong.


• Your EFC number is not written in stone- It will change every year as your circumstances change and as Congress makes changes to the EFC formula.

Which brings me to the most important point about your federal application and your college loan (or loans)...

FAFSA Renewal Must Be Done Each Year, So...

Maybe your income will go up (or down). Perhaps a sibling will be going to college. You might be living in an area that qualifies for federal disaster relief, whatever- things change.

This is good news, because...

...whatever financial aid sins you've committed in the past, you can fix them before your next submission. And many of these corrections take some planning. Before I get into the particulars about your application, here is a list of the...

Seven Deadly FAFSA Sins

1. Allowing the student to have assets: There should be no assets in the student's name- all savings plans, investments, accounts, etc. should be under the parent's name(s). Why? Because student contributions are weighed much higher than parents' contributions.


2. Having cash on hand: Money in savings and checking accounts (parents included) will mean that the student is going to qualify for less aid. If you have money, use it to pay off your consumer debt.


3. Accepting money from grandparents for college: Ask them to wait until the student is finished with college, otherwise it will count as part of the expected family contribution.


4. Withdrawing retirement funds: During the base year for your application, do not withdraw money from any type of retirement fund, because this type of investment is not included as an asset.


5. Taking out a home equity loan to pay college expenses: I won't say that it is never right to use your home for this purpose, (because in some situations it is) but use a home equity line of credit instead. That way, any unused money won't show up as an asset the following year.


6. Leaving a blank space: Never leave an entry blank! If you do not know the answer, put a zero down instead.


7. Being dishonest: You will get caught- the federal government and the schools have improved their abilities to spot fraud and the penalties are severe.

These are the basic mistakes to avoid. Doing what you can to avoid them is a legitimate strategy. Please take any advice about other strategies with a grain of salt.

The information that is available on the net (usually for a price) can range from common sense (like mine)- to absurd (like telling an elder sibling to wait a couple of years to enroll in college)- to criminal (like telling a parent to enroll in a college at the same time as the child, but then to let their registration lapse after their financial aid application is processed).

OK, let's begin at the beginning with your FAFSA PIN . Next, you should download a printable application