For those of you who are preparing to send your kids to college, you may have heard of the Free Application for Federal Student Aid (FAFSA). The common assumption is that this form is only necessary for families that are requesting need-based grants. Many parents that are sending their kids to college assume that families with above average income need not apply. However, what many people do not know is that federal financial aid also has non-need-based components, and is used to process other areas of funding, such as scholarships and student loans.
The application is free and easy to complete and can be accessed by going to www.fafsa.ed.gov. If you do not qualify for need-based aid, you will probably qualify for unsubsidized loans and/or a parent loan (PLUS). These loans often have better rates and terms than private loans, so it is best to start there. If you need more money than the federal loan provides, you can always make up the difference with private loans.
College-bound students may need to complete a FAFSA to apply for a scholarship, as many colleges and universities require a completed FAFSA in the scholarship application process. When determining scholarship awards, the financial aid department will often rank applicants on various criteria, one of which is the applicant’s amount of need calculated from the FAFSA. While not all scholarship money will be need-based, information taken from the FAFSA will be used in determining awards.
The best place to start looking for funding options is the financial aid office of your child’s college. They should be able to provide you with guidance for which types of financial assistance your child may be qualified. There are scholarships that go unused every year because qualified individuals never applied. For example, at one university, there is a scholarship available to students of American Indian heritage, which frequently has no applicants because the scholarship is relatively unknown.
Completing the FAFSA
After discussing your options with the financial aid office, go to the FAFSA website. Review the list of documents you will need to complete the form. Apply for a PIN, which will be your electronic signature that will never change regardless if you transfer colleges. Student and parents have separate PINs. Parents will use the same PIN each year and for multiple children.
It is helpful to apply for funding as early as possible (you can apply on January 1st) because some schools award scholarships in rounds. The first round typically has the fewest applicants for many reasons: procrastination, waiting for tax information, still choosing a school, unaware of deadlines, etc. The fewer applicants to choose from, the more likely your child will be selected for a scholarship.
The university’s financial aid office will give you their school code to put on the FAFSA so that the student’s information will be sent to their school. You can do the same thing for multiple schools. School codes can also be found on the university’s website or the FAFSA website.
For more information regarding grant opportunities, you can also go the U.S. Department of Education website’s section on funding http://www2.ed.gov/fund/grants-college.html. For information about student loans, it might be helpful to look at www.salliemae.com.