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A Guide to the New Better FAFSA: Everything You Need to Know
By Monica Selagea
September 22, 2023
Navigating the ‘Better FAFSA’ Changes: A Step-by-Step Guide for a Smooth Application Process
The thought of attending college or continuing to a different postsecondary path can be stressful, but perhaps even more daunting is paying for your chosen path. Luckily, not all colleges have the same sticker price and tuition fees do vary, but college costs overall are on the rise because of inflation and cuts to state funding, among other factors. For students from low-income communities and their families, affording a college education can be a remarkable financial challenge. That is why the Free Application for Federal Student Aid, better known as FAFSA, is imperative to understand and complete during a student’s senior year.
What is FAFSA?
FAFSA is a federal financial aid program that connects students who want to pursue a higher education with financial assistance like federal, state, and institutional aid. Correctly completing and submitting the application is a significant pathway to receiving financial support and can alleviate the financial burden of college costs. The amount offered varies since the funding is provided by the federal and state governments, and/or colleges. For example, Illinois students who are eligible can receive a maximum federal and state amount of approximately $16,000 for the year. To be eligible for FAFSA, a student must demonstrate financial need, be a US citizen or eligible noncitizen, have a valid Social Security number, and be accepted or enrolled in an eligible degree or certificate program.
OneGoal Program Directors spend countless hours preparing students for FAFSA opening day as part of the three-year program. Parents are also involved in the process to ensure a successful submission. Navigating through the FAFSA process is overwhelming, but it’s a pivotal step in making higher education a reality for our students.
Who Meets the Requirements?
The aid students receive varies depending on a student’s income, financial situation, and certain household information. Once these details are assessed and calculated, the student will be eligible to receive a specific amount of aid from the federal and state governments. Colleges will also use this federal and state aid information, among other factors like student GPA and SAT scores, to determine how much aid to offer students. If the student is in financial need, is a citizen or an eligible noncitizen, and is enrolled (or will be enrolled) in a degree or certification program at a college or career institution, they are eligible to receive aid. Educators, counselors, parents, and students can use a student aid calculator to estimate their aid
Typically, at the beginning of a student’s senior year, high school counselors assist with financial aid. This can be done through one-on-one sessions with students, parent meetings, or in a classroom setting. Parents should reach out to their student’s counselor if they have concerns or unique situations that require sensitivity or further guidance. In Illinois, for example, all high school students must complete the FAFSA in order to graduate, unless they’re undocumented. Undocumented students complete an alternative financial aid application. Completing the FAFSA is not only mandatory, but also essential for accessing aid. However, it can be an exacting process, so high school counselors should try their best to teach and guide students to comprehend the process. Students having this understanding is valuable since they will complete the FAFSA every year while in college.
A OneGoal Fellow recently shared his experience with completing the FAFSA: “Even as I think of reapplying for FAFSA next year, I know it’s going to be different than the first time around because now my mom is going to work again and so I’ll likely get less aid. But I now know how to look for the best scholarships for me. So when FAFSA opened up on Oct. 1, I finished it on the 2nd. Now I’ll be talking with friends from college about whether they’ve completed it and they don’t know anything about it, let alone that it was something they’d have to complete and get done! It feels really good that I don’t have to be behind or wondering, ‘am I going to get as much aid as I need,’ because once you become an expert in it, filling it out year after year isn’t that scary.”
When Does the FAFSA Application Open?
In the past, FAFSA opened its application on October 1st. For the 2023-2024 school year, FAFSA is changing. It will now open in December 2023 and has been branded as the “Better FAFSA.”
What’s Changing with the Better FAFSA?
According to Federal Student Aid, the Better FAFSA will translate to a more streamlined process, increased eligibility for grants, and reduced barriers for some student populations. The number of questions will be reduced and there will be a reduction in colleges requesting verification of financial information, which will allow more students to gain access to the financial aid they need to attend college.
As an educator and OneGoal Program Director who prepares students for their postsecondary path, I think this is great news! Currently, counselors, staff, and educators, like myself, are attending professional development to learn about the changes so we can provide knowledgeable assistance. We remain optimistic about the opportunities this change can offer to more students who want to attend college, and hope it eliminates stressful financial setbacks.
There are several factors that determine a student’s eligibility in receiving aid, but the family’s income, assets, and household size are the main criteria that are assessed. To start the process, counselors may ask students to bring in their parents’ taxes from the previous year. For example, for this year’s application, students must have their parents’ filed Federal taxes and W-2s from 2022. If the student worked and filed federal income taxes, they must also have their documents handy. This is sensitive information and your student’s counselor should be respectful of each family’s situation. Parents should be able to trust that the student’s counselor will handle this process with care. It is absolutely normal to ask the counselor questions about the FAFSA or why they are requesting that you or your student complete certain tasks.
Students and parents must also create a Federal Student Aid ID, or FSA ID, which is the username and password needed to log into the FAFSA application. This can be created at the Federal Student Aid website by choosing “New to the FAFSA”. The FSA ID serves as a legal and electronic signature when submitting the application. If the student or parent does not have a social security number, they are still able to create an FSA ID. With the Better FAFSA, undocumented individuals will complete alternative steps to verify their identity. Complete details have not yet been released. The process can take several minutes to create, but is mandatory in order to submit the FAFSA application. It will take one-to-three days for an FSA ID to go through the verification process. Plan on setting up an FSA ID at least one week prior to starting the FAFSA.
Step-by-Step Guide to the FAFSA application
After creating the FSA ID and logging in, there are some questions and steps to complete for security purposes and sign-in verification. Students and parents should record their username, password, and other information to ensure a safe login.
Once logged in with the student’s login and password (not the parent’s) and on the “Welcome” page, you will see three questions: students should choose, “I am the student who wants to access the FAFSA form.” Although there are other choices, the student should always be present with the parent to ensure all the information is accurate and correct. The parent(s) and student should work together in the financial investment for the student’s future.
On the next page, students need to choose the correct school year keeping in mind that they are completing the FAFSA for the following year. For example, if the senior is completing the FAFSA in December 2023, their academic school year will be 2024-2025. This means that FAFSA will calculate eligibility for two semesters: Fall 2024 and Spring 2025.
At the “Let’s Get Started” page, students should review the page and choose “Continue.” This page is a summary of what is forthcoming to complete, along with a drop-down menu should the student or parent(s) have any questions prior to completing the application.
The next screen is a “Create Safe Key” page. The safe key is a five-digit number that students create in order for their work to be saved should the application encounter an error or issue. This safe key does not take the place of the FSA ID: it is a temporary number that is used until the student and parent submit the FAFSA.
There are six sections to complete: Student Demographics, School Selection, Dependency Status, Parent Demographics, Parent Financials, and Student Financials.
Section 1: Student Demographics
This section consists of several questions that pertain to the student such as an address, educational background, and social security number, among other personal questions. This section is fairly easy to complete and should be completed by the student.
Section 2: School Selection
This section is vital for the student to complete. Here, the student is able to choose up to 10 schools. These are the schools that the student is considering to attend and therefore is applying for aid. Should the student decide to change schools, it can be modified even after submission. Counselors advise students to add as many schools as possible to ensure that aid will be distributed to one of the schools listed should the student be accepted. Students can add the school using the schools’ Federal Code or by using the drop-down menu to search the school by city and state. For each school, the student must indicate if they will be living on campus, off campus, or with a parent. This can determine eligibility and can also be modified if the student reconsiders after submission.
Section 3: Dependency Status
This section contains more questions regarding the student. The questions in this section are used to determine if the student is dependent upon their parents, or independent of their parents according to FAFSA purposes. The standards used to make this calculation are very strict and the questions must be read and answered carefully. A student will be independent if they are married, a veteran of the US Armed Forces, in foster care, an unaccompanied homeless youth, or an emancipated minor. If a student or parent has questions about these criteria they should consult with their student’s counselor or visit the Federal Student Aid website for more information.
Section 4: Parent Demographics
This section pertains to the parent and their relationship to the student. These questions must be answered carefully. For the FAFSA, the definition of a parent is a biological or adoptive parent. The parent will also need their social security number. If the parent does not have a social security number, the student should enter 000-00-0000.
Section 5: Parent Financials
For this section, students will need their parent(s) taxes. Most of the answers to the questions in this section will be found on the tax return or W-2s. If a parent is unsure of an answer, FAFSA will direct the parent to the answer by providing a question mark after each question. Each question mark will provide information on where to find the exact answer. If followed correctly, it can minimize mistakes that can impact eligibility. In this section, the parent will have the option to use the IRS Data Retrieval Tool. FAFSA and counselors strongly encourage the use of this tool.
IRS Data Retrieval Tool (DRT)
This tool allows a parent to securely transfer original IRS tax return information directly and automatically to the FAFSA form. If the parent chooses to use this tool, the application will display a new page that must be filled out correctly. Once completed, FAFSA will autofill several questions. This saves time and prevents mistakes that can be detrimental to the aid calculation. Using this tool will also allow the student to bypass a verification process often asked as an extra measure of security by universities. If the tool is not used, a student may be asked to complete more documents even after the universities offer aid. To avoid more paperwork and time, use the DRT.
Section 6: Student Financials
In this section, students are asked about their finances. This is similar to the Parent Financials section. Complete this section if the student filed federal taxes. If the student did not file taxes, they need to choose this answer in the drop-down menu. It will direct the student to the final section.
Final section: Submitting the Application
On the Sign and Submit page, students and parents must enter their FSA ID in order to submit the application. Students will receive an email from Federal Student Aid stating that the application has been submitted. An estimated amount of aid will be available to view in the Student Aid Report or SAR immediately after submission. This amount is based on the Expected Family Contribution (EFC) and is only an estimated amount. Parents and students should carefully review it to make sure the information is correct. The schools the student listed on the FAFSA will use the information from the FAFSA to determine eligibility for federal and financial aid and will be part of the student’s financial award letters sent during the spring, after a student has been accepted to the universities.
The beauty in submitting the application is that a student can modify or make changes even after the application has been submitted if they think they made a mistake or for any changes in the School section. Students are allowed to change their mind if they consider other schools listed on the FAFSA form and should change them promptly to ensure the aid will be received by the school.
Expected Family Contribution vs Student Aid Index
In the past, aid was based on the EFC. This is a number that college financial aid staff use to calculate how much aid to give to students. The EFC is calculated according to a formula established by law. The student family’s taxed and untaxed income, assets, and benefits (such as unemployment or Social Security) all could be considered in the formula. Also considered are your family size and the number of family members who will attend college or career school during the year. College financial aid staff use the following formula to calculate aid: Cost of Attendance – EFC = Financial Need. Colleges use a combination of grants, scholarships, and loans to meet the student’s calculated financial need. The higher a student’s EFC, the less free money (grants and scholarships) and more loans a student will receive. With the Better FAFSA, a Student Aid Index (SAI) will determine a student’s eligibility for aid. Use of the SAI will begin for the 2024-2025 award year. The SAI will be calculated based on the family’s income contribution.
A Smooth FAFSA Application
For first-time applicants, a student’s counselor, trusted educator, or OneGoal Program Director should assist the student and parent with the application process. Submitting the application shouldn’t take more than 30 minutes to an hour with guided assistance; however, the student and parent must be fully prepared. With the new changes coming in December 2023, the process should be easier. Nevertheless, it’s important to follow the aforementioned steps to be ready for any changes FAFSA may have forthcoming.
Monica Selagea grew up in Chicago and attended Columbia College in Chicago and DePaul University. She is currently a high school teacher in Chicago and a Program Director for OneGoal.