Too many families don’t start thinking about the Free Application for Federal Student Aid (FAFSA) until the fall of their student’s senior year. After all, you can’t even submit the form until October 1st so why start worrying sooner? Because the FAFSA is just the final step in the financial aid process. And if you don’t take the right steps before you actually submit the application, you can dramatically reduce your opportunities for financial aid.

Your Financial Aid Application Starts in the Sophomore Year

The FAFSA uses your financial information for the tax year that starts January of the sophomore year. This means that most families’ EFC is determined before students decide which colleges to apply to.

Why Do You Need to Know This?

Because for some families, there are a few simple things they can do that can have a significant effect on their EFC. The FAFSA assess the amount of money available for financial aid differently depending on who the money belongs to and how it is being used. If you wait until you file the FAFSA to find this out, you won’t be able to do anything about it.

You EFC is a Minimum Amount You’ll be Expected to Pay

Theoretically, the Expected Family Contribution (EFC) calculated by the FAFSA should be the maximum a family pays for college. However, the bulk of the financial aid to meet the student need comes from the colleges that students actually attend. And most colleges simply do not have the money to meet 100% of student need.

Why Do You Need to Know This?

Because some colleges are more likely to meet student need than others. Furthermore, many schools practice some form of preferential packaging. This means that schools provide more desirable financial aid, grants and scholarships, to students they really want to attend. For less competitive students, colleges may offer financial aid consisting of various loans. Families need to know this information so that students can apply to colleges most likely to meet their financial need.

The FAFSA isn’t the Only EFC

Over 200 colleges require students to submit another financial aid form called the CSS Profile in order to qualify for institutional aid. That is, if you want money from the college and not just the government, you have to submit the CSS Profile. The CSS Profile has its own methodology for calculating EFC, usually referred to as the institutional methodology.

Why Do You Need to Know This?

Because the CSS Profile uses information the FAFSA doesn’t, including home equity and non-custodial parent income. And since each school has its own methodology, you can’t use a generic EFC calculator to estimate your costs. Given how differently the CSS Profile treats certain assets, you may want to target CSS Profile schools or avoid.

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Use R2C Insights to help find merit aid and schools that fit the criteria most important to your student. You’ll not only save precious time, but your student will avoid the heartache of applying to schools they aren’t likely to get into or can’t afford to attend.  

Other Articles You Might Like:

CSS Profile Guide: How to Fill It Out, When, and How to Submit

Tips for How to Fill Out the FAFSA, the CSS Profile, and Other Aid Forms

How to Make Affordable Colleges Even More Affordable

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