We completed the FAFA for our son and it did not require that we fill out the asset section (due to income lower than the threshold) which resulted in an EFC of zero. As the parent, I am returning to school this year and would like to complete a FAFSA for myself. The FAFSA will require that I include my assets which may exclude me from aid (i.e. result in a much higher EFC). My question is this: If I enter my assets and submit my FAFSA, will that information somehow make its way to my child’s FAFSA and affect his EFC? We will be attending different schools so I don’t expect the institutions to communicate between one another, but I don’t want to jeopardize my son’s EFC. Thank you for any insight.
I believe the answer is NO.
But you do understand that the FAFSA EFC should be viewed as the minimum your child will be expected to pay….right?
Not sure what you mean by minimum? I thought the EFC was the maximum amount the student/family was expected to pay out of pocket. For example, if total cost is $30k and the EFC is 5k, then the $25k will be made up with a combination of scholarships/grants/loans. Is that not correct?
That is not correct for the vast majority of colleges. Most colleges do not meet full need for all accepted students. And the ones that do mostly use the CSS Profile or their own form in addition to the FAFSA.
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No, and this is one reason why the misleading FAFSA term “Expected Family Contribution” will change to “Student Aid Index” starting with (I believe) the 2023-2024 academic year. Although, I suppose your assumption is partly correct, because most parents could take out a Parent Plus loan to pay for any gap. For example, if a school costs $50,000 for freshman year and the FAFSA EFC comes to $10,000, the school could offer $5,000 in financial aid, the student could use a $5,500 direct loan, and the parents could fund the rest with a $39,500 Parent Plus loan. But that probably wouldn’t be very smart.
I jam not sure that you will be asked to include your assets if you didn’t have to do it in your child’s FAFSA. If you have accumulated additional assets since completing your child’s FAFSA, you may need to do so, of course (if it kicks you over the threshold for reporting). However, even if you do have to report your assets, your child’s FAFSA won’t be affected. FAFSA asks for assets on the day you initially submit the form. You don’t update them at any point in the future for that financial aid award year.
This is not a direct answer to your question, but if you haven’t already done so, you should run the net price calculators for all colleges of interest to see how the colleges will fund your need— whether with grants, loans, etc. That should help you plan better.
The FAFSA really only tells you if your student is eligible for a Pell Grant and gives them access to the ~$5500/year federal student loan. If your EFC is $5,000 your child may be eligible for a Pell Grant of ~$1495/year. If your EFC was $0 they’d be eligible for the full ~$6495/year grant. If your EFC is $7,000 they wouldn’t be eligible for any Pell money.
Scholarships aren’t guaranteed at all. Those come directly from the colleges. You’ll have to check individual college websites to see what’s available.
It’s true if you expect a lot of loans, maybe even parent PLus loans as part of the package. With an EFC of $0, your child would get a Pell grant, maybe an SEOG grants, and probably subsidized loans of $3500 for the first year. Also a $2000 unsubsidized loan. The rest MAY be composed of some school need based aid, but maybe not.
It really depends on the school and the state. Some states have other aid for residents. Florida has Bright Futures, Georgia has Zell (both merit based), Colorado has a $75/per credit. Other states have great aid for residents (Michigan, Virginia) but very hard to get into the top schools.
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While Michigan has a couple schools with great need based aid for the poorest students, aid for those above the income cutoff is not good. And it’s just those couple schools (with UMich being the best deal for low income, but also not easy to get into). For many, many families, there isn’t a whole lot of “free money” available to plug the difference between cost and EFC. Community college, commuter schools, looking for guaranteed merit if it’s a top student are ways to minimize costs.
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