Looking for an edge in the early scramble to prepare your 2010-2011 FAFSA application? Here are the 10 tips for getting your fair share of $168 billion.
Looking for an edge in the scramble for financial aid, more students are jumping in early to get help preparing their 2010—2011 federal student aid application (FAFSA) to maximize their chances for a piece of the $168 billion now available to pay for college.
Answering this year’s 130 income, asset, and dependency questions is often challenging, especially for high school seniors and their parents facing the application for the first time. Nearly everyone regardless of income or circumstances is eligible for aid from the more than 8,000 programs that offer grants, work-study, and low-interest loans.
Professional student aid advisors suggest the following 10 tips on how to maximize your student aid:
Most aid is offered on a first-come, first-served basis and nearly everyone can benefit. Applying in January is the smartest move. You don’t have to file your income taxes before preparing your aid application — accurate estimates of your adjusted gross income are acceptable.
If you miscalculate your adjusted gross income or make a simple mistake, you could lower your aid award. Be aware that your taxable income is not your adjusted gross income. If funds from a retirement fund are withdrawn, check to see if they are taxed or not. Don’t roll this figure into both your untaxed income and the adjustable gross or you’ll inflate your expected family contribution and lower your aid award.
States, colleges, and the federal government have different deadlines. Some state deadlines are as early as February 15: deadline list link.
Know your dependency
Mistakes are common when answering dependency questions because children of divorced parents often believe that the parent they live with is their legal guardian and that they are in a legal guardianship. Not true in all cases. Answering incorrectly changes your status to “independent” and that usually changes your aid.
If someone in your family has suffered a job loss, you may be eligible for more aid. Check out the “dislocated worker” question and see if you meet one of the four criteria. Assets are treated differently for “dislocated workers,” and this could reduce your expected family contribution to zero, which increases your aid award.
Don’t count your house as an asset
While your home is one of your biggest investments, a primary residence isn’t considered an asset on the FAFSA. Including it will reduce your aid award.
Know the rules for family businesses
When calculating assets, not all businesses are treated the same. A family-owned business with fewer than 100 employees isn’t an asset on the FAFSA. If you make a mistake on this one, your application won’t be rejected but you will receive less aid than you deserve.
People commonly make errors on the simplest things by transposing numbers or mistyping. List your name and Social Security number exactly as they appear on your Social Security card.
Get early insight
Colleges mail award letters in April and May. If you’re a high school senior, you can end the anxiety about how much aid you can expect by having the service StudentAid.com calculate and compare the ‘net price’ of the colleges you’re applying to. The service is free to all low-income students (household income less than $40,000).
Get professional help
Some communities sponsor FAFSA events and the federal government authorizes getting help from fee-based FAFSA preparation services. Make sure your FAFSA preparer focuses on accuracy by double-checking all answers, not only with computer programs but also by a human review of your application.
Student Financial Aid Services, Inc. (SFAS) is a fee-based preparation and aid advisory company dedicated to helping America’s families access the most student aid possible to pursue their college dreams. Based in Sacramento, CA, SFAS is the oldest and largest student aid preparation service in the US. Families seeking aid advice may call toll-free 1-877-323-7224.