Don’t pro­cras­ti­nate on fil­ing for stu­dent aid

The Morning Call - - BUSINESS CYCLE - Terry Sav­age

It’s FAFSA time again. Stu­dents and their fam­i­lies who are hop­ing for fed­eral stu­dent aid for the 2020-2021 col­lege year can now file this es­sen­tial form.

Pro­cras­ti­na­tors lose out, be­cause many schools of­fer their pool of merit-based aid on a first come, first served ba­sis. And they look at FAFSA to get the en­tire fi­nan­cial process started.

The FAFSA form — a re­veal­ing pic­ture of the stu­dent’s fam­ily fi­nances — de­ter­mines the amount of fed­eral need-based aid that will be of­fered. That leads to the Stu­dent Aid Re­port, which de­tails the Ex­pected Fam­ily Con­tri­bu­tion. Af­ter the school of­fers work/study pro­grams and merit-based aid from its en­dow­ment, it’s up to the fam­ily to fill the gap, ei­ther from sav­ings or from pri­vate bor­row­ing.

You can learn more at FAFSA.ed.gov, where you can fill out the forms on­line. Even bet­ter, down­load the MyS­tu­den­tAid mo­bile app, avail­able for Ap­ple or An­droid de­vices.

Start by set­ting up your ac­count and cre­at­ing a pass­word. This process will cre­ate your FSA ID. Par­ents and chil­dren can and should cre­ate sep­a­rate pass­words — help­ful for par­ents who want to keep in­come in­for­ma­tion pri­vate and out of view of ei­ther the stu­dent or a di­vorced spouse. The cus­to­dial par­ent’s in­come tax in­for­ma­tion will be au­to­mat­i­cally down­loaded into the ap­pli­ca­tion.

FAFSA uses in­for­ma­tion from the in­come tax re­turn you filed for 2018, so don’t wait for your year-end num­bers. If the fam­ily has had a sig­nif­i­cant drop in in­come, there is a way to amend the form.

Here are some FAFSA tips from a pro, Eva Dodds, who coun­sels fam­i­lies on the process through her af­fil­i­a­tion with Col­lege­Wise.com. She is an ac­cred­ited col­lege coun­selor and for­mer dean of stu­dents.

Make sure your con­tact info on the form is cor­rect, and watch for an email re­sponse no­ti­fy­ing you that your stu­dent aid ac­count is ac­tive for this year. Also, watch for emails re­quest­ing more in­for­ma­tion.

Don’t as­sume you won’t qual­ify for fi­nan­cial aid. File any­way. Some schools re­quire FAFSA be com­pleted be­fore they will give out merit aid.

Con­sider fil­ing the Col­lege Board CSS Pro­file, which 400 schools re­quire, in ad­di­tion to FAFSA.

Make a list of the top 10 schools you want to re­ceive your SAR re­port. It will be sent to them au­to­mat­i­cally at the same time you re­ceive your copy, likely within 10 days of com­plet­ing the ap­pli­ca­tion. You can al­ways add more schools to the list.

Don’t for­get to reap­ply for fi­nan­cial aid if you re­ceived it last year. The process is not au­to­matic, and the same dead­lines ap­ply.

Dodds also rec­om­mends that you call the school fi­nan­cial aid of­fice and ask how that spe­cific school might sup­ple­ment any fed­eral fi­nan­cial aid, such as Stafford loans and Pell grants, as well as work/study pro­grams.

A fi­nal rec­om­men­da­tion: As you make your list of col­leges to re­ceive the re­sults of your FAFSA form, start by con­sid­er­ing the price tag. Use the ex­cel­lent EFC cal­cu­la­tor called FAFSA4­caster at FAFSA.ed.gov to see your likely net cost for each school to which you are con­sid­er­ing ap­ply­ing.

Think how hor­ri­ble it would be for your child to re­ceive an ac­cep­tance let­ter and then hav­ing to tell him or her you can’t af­ford that col­lege. And that’s The Sav­age Truth.

Terry Sav­age is a reg­is­tered in­vest­ment ad­viser and the au­thor of four best-sell­ing books, in­clud­ing “The Sav­age Truth on Money.” She re­sponds to ques­tions on her blog at Ter­rySav­age.com.)

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