It’s that time of year. No, we’re not talking about the leaves changing or pumpkin spiced lattes—it’s time to fill out the Free Application for Federal Student Aid (FAFSA). The 2019-2020 FAFSA became available on October 1 and could be the key to helping make college more affordable.
To receive the maximum benefits, you need to complete the application correctly. While this year’s FAFSA form was revamped a bit to make applying easier (for example, you can now complete it from your phone), it still benefits students (and their parents) to have a little extra help.
Charlie Javice was one of those students. After struggling through the financial aid application process while applying for college, the now 26-year-old thought there had to be a better way.
“The FAFSA is a great way to get money to help pay for college,” says Javice. “I just wanted to create something that made it as easy possible.”
Todo this, she founded Frank, a web-based service that helps students filling out the FAFSA receive as much financial aid as possible. Frank streamlines and simplifies the application process with smart technology that boils down the 110 questions found on the FAFSA to 30 and pulls information from your Common Application and tax returns. It’s like TurboTax for financial aid.
Javice completed a lot of research while developing Frank and found that many applicants were routinely making slip-ups that caused them to miss funding opportunities.
What are those mistakes? Well, here are the five most common ones and how to fix them.
Javice was lucky—her parents made decent incomes. As a result, she initially thought she didn’t qualify for financial aid.
Assuming that you won’t qualify for financial aid because your parents are not struggling financially is a major misconception.
“Financial aid is for 95 percent of everyone in the US who cannot afford the many tens of thousands of dollars a year to go to college, in terms of discretionary income,” says Javice. “But, only half actually fill out the FAFSA to get the money they deserve.”
Regardless of their financial situation, all students have the opportunity to apply for various types of aid, including:
Typically, Javice recommends that students from households making under $250,000 complete the FAFSA. This figure should only include sheer income and should not combine household income with assets. Even if your family’s income exceeds this amount, if you have a very large family, you should still apply.
If your parents or legal guardians are taking care of multiple dependents, the government will take this into consideration when looking at salary amounts. A $250,000 household supporting one child is different than a $250,000 supporting three college-aged children, for example.
You’ve decided which colleges you want to apply to and you want to fill out the FAFSA. You look at the deadlines and realize you have months to get it done, right? It’s true that you have until June 30 to submit your FAFSA application, but don’t wait until the last minute to apply.
“A lot of the money available is “first-come, first-served,” and a lot of the aid and school admissions are rolling. This means decisions are made on a rotating basis instead of by a set deadline,” says Javice. “Merit aid runs out pretty fast, and state aid is oftenbased on budgets, so that will run out, too. The earlier you come, the more aidfor the budget year is still open, so you can still access it.”
In fact, experts believe that you can get twice as much grant money by filing early. To make sure you qualify for the best funding options, fill out the FAFSA form as soon as possible. Remember, for the 2019-2020 school year, you can submit your FAFSA now.
You would think answering questions about yourself would be easy, but the personal information section is where many applicants make mistakes. Javice noticed that people were confused by the jargon of the FAFSA, which led to inaccuracies in the completed application.
Luckily, the new FAFSA has pop-up windows explaining terms, but here are some of the most common hang-ups:
o If you are a dependent student, just list your parents and whom they financially support.
o If you’re a parent of a student, include all of those for whom who you are financially responsible. This could include a spouse, stepchildren, and other relatives.
Making mistakes about personal information is easy enough. Many people also make math errors that could lead you to missed opportunities. “There are two main areas where we see an issue,” says Javice. “One is with tax math errors, and the other is determining your assets.”
Here’s how to handle these two potential pitfalls:
o Your returns should not be for the current year, but for the previous year.
o If you have not filed taxes, and you earn above $10,000 a year as either a parent or a student, you may run into a problem.
o Third, pay attention to the first two pages of your federal returns. Specific line numbers contain information you will need when you do the tax math yourself.
o Do you include real estate? “We’ve had families that inherited a million-dollar property, but their income for a household of five is below $50,000,” says Javice. “A primary home is not considered an asset when it comes to the FAFSA.”
o Do you include savings and retirement? Pensions, 401(k) plans, IRAs, and cars also don’t need to be reported. A 529 account, on the other hand, is considered an investment.
The Department of Education has a brief list to get you on the right track, but it may be best to use a service like Frank or to reach out to an accountant to help you sort through your portfolio.
Many students don’t know that they can negotiate with colleges for better funding opportunities. “Look at it as a job offer,” says Javice. “You should always negotiate. There’s no reason not to, and there are two main reasons why you should do it.”
Specifically, Javice identifies two cases where negotiation may be appropriate:
Javice offers an aid negotiation program. Her team has successfully increased financial aid awards by an average of $5,000 per student per year. Even if you don’t use her service, you can still request more money.
If any of the options in this section apply to you, simply write a detailed letter explaining either how your financial situation has changed or providing the details of a competing school’s offer.
Avoiding these mistakes offers an opportunity to potentially save thousands more dollars in financial aid. By asking for some help during the FAFSA application process, you could score more grant money or secure some low interest federal loans. And that, of course, means less stress on you financially and more time focusing on the college experience.