Nobody likes loans. But the reality is that most borrowers pay their loans- on time- and for many of them, loans were the difference between getting a college education and not. Trying to avoid student loans? That’s 100% of the people in America. But it’s not always a viable strategy, unless your D has a no-loan option.
The federal caps on undergrad loans are pretty reasonable IMHO. And help a new grad learn to budget, live like a typical 22 year old and not someone from a TV show or their favorite TikTok influencer who is living in a 5,000 square foot apartment a year after graduating from college!
Based on what you said the FAO said, I can think of three things.
as Mwfan has already posted, if you didn’t report the amounts in Box 12 of your W2 to FAFSA as untaxed income, the schools will add it back in. That can have a big effect on your EFC, as income is assessed very heavily. Box 12 data is typically the amounts that people contribute to their 401ks.
If you have money that you intend for retirement, but that are in regular savings or checking accounts (ie, not in a 401k or IRA or 457) then that money can’t be reported in the retirement section of your assets. It needs to be reported as “regular” assets. If a school recharacterized your retirement asset amounts as regular asset amounts, that could have caused the increase, as retirement assets are shielded from financial aid assessments, while “regular” assets are not. However, I don’t know what information a school would see that would make them decide to do this. (Also, it’s confusing, because contributions to 401ks for the current year are added back into your income for financial aid assessment, but the assets that are already in the 401k from previous years are shielded from the asset assessment).
If you had an IRA rollover, that causes a lot of problems because FAFSA mischaracterizes it, but that can be corrected.
Not that I know of. The FAFSA is completed as of the date of filing…definitely for things like asset values. Other numbers on there come from your 2021 tax return when completing the 2023-2024 FAFSA. Those shouldn’t have changed!
@Brillig did you do a rollover of a tax deferred account? Did you use the IRS Data Retrieval Tool when completing your FAFSA, or did you manually enter your info.
They promise to meet need according to their institutional calculations
The vast majority of colleges that meet full need for all also use the CSS Profile or a financial aid form of their own. It’s very possible that something entered on the Profile did not align with what you entered on the FAFSA.
Any chance you are self employed, or own rental properties or other real estate in addition to your home?
I know that people want the FAFSA help line to be more helpful, but their function is limited. They may have been able to see which school made changes at one time, but they can’t see now. Families are able to contact the schools, so it’s not like they will never know (and the vast majority of students only apply to a few schools).
As others have noted, if you contributed pre tax money to your 401k or 403b, the amount contributed will show on your W-2. Any school that collected your tax forms/W-2s will see the contributions and will be required by law to correct the FAFSA if you did not report the contributions on your FAFSA. Depending on how much you & your spouse contributed, this can raise the EFC considerably.
I don’t know what would have prompted an aid officer to increase the amount of your investments, unless you reported a higher number on your CSS Profile than you reported on your FAFSA. However, if you did do that, while they are free to use the higher amount on your Profile for purposes of awarding institutional aid, unless they have clear information documenting that you underreported assets as of the day you submitted your FAFSA, they can’t change the amount on your FAFSA.
So there are two issues at play:
You should have reported your retirement contributions and did not do so. Your schools need to be informed of the amount you contributed.
The increased investment amount should be removed from your FAFSA, from what you have indicated (note: if you initially filed your FAFSA with the higher amount & later changed it to a lower amount, for example when you added schools to the FAFSA, you do have to use the initial higher amount - if this is the case, my advice changes). Your schools need to be made aware that another school updated this in error (or made the error, depending on the school).
I suggest making an update to your FAFSA to report your retirement contributions and restore the investment amount (assuming you never made any change to the amount) to the number you reported on your initial FAFSA. You will have to do this for your initial FAFSA and for the FAFSA transaction on which you added schools. Then contact each school to let them know what you did & why you did it. You can do this by email, requesting a confirmation that they received this new information. If your child has eliminated any schools from consideration, don’t bother contacting them.
Thanks for the helpful info and suggestions from several of you—much appreciated. It looks like the retirement contribution change was indeed due to my mistake, so that correction was right.
For the investment amount, I don’t know what triggered that—as @kelsmom notes, this does seem to be an error. That question on the FAFSA specifies the amount on the day you submit the form, so I don’t know how an FAO could be able to correct that months later. (It is possible that I used a different amount for the corresponding CSS Profile question, since I did them at different times.) I’m going to change it back and contact the schools that are still in the running.
Coincidentally I ended up reading this thread this morning and then a few hours ago we got an email that our FAFSA had been updated! Not our doing. Given what you just went through, what would you suggest we first do to find out what we should do first to see what is going on? Probably one of the private schools our daughter was admitted to, maybe? Start there? I’m so confused. I have no idea what was changed.
Good question—how would we know if it changed EFC? I wish I had saved a copy! I wonder if I could figure it out by comparing our D23s FAFSA to her older brother’s. They were submitted the same day. Hmmm.
You can see every transaction in the student’s FAFSA portal. You are able to specify the transaction you want to see when you sign in - it defaults to the most recent, but you can change it to an earlier transaction. So if you only did FAFSA once & you see transaction 02 when you sign in, you can look at both the old & new to compare.
If you just got the notification, the new FAFSA transaction may already be available for you to see. If not, it’s possible that you may have to wait a couple days for it to complete processing. You’ll be able to compare EFCs between the two. If the EFC is the same, whatever changes were made aren’t an issue. If there’s a change in EFC, it was most likely a private school that changed it - probably based on your actual tax information submitted on IDOC (so that may narrow the suspects). If they saw information in the documents submitted that was not correctly reported on FAFSA, they are required to update the FAFSA accordingly.
We are also trying to figure out the mystery. Thankfully, our EFC went down a small amount. We are also stunned that a college can do this w/out further explanation. It’s shocking that there’s no transparency when it’s our personal data. No idea what was filled out incorrectly.
On another note, do you think this is a school that we have not received financials from yet? It would seem strange to be doing this after letters a provided.
This appears to have happened just two days ago. So, I guess it also seems strange to be doing this the days before decision letters are released.
All-around weird.
Oh well, fingers and toes crossed good news is on the horizon!
If I find anything out, I’ll share here.
Schools are required to review all available information, and if something in a student’s file does not match what is on the FAFSA, the school is required to update the FAFSA so that it matches the available documents. Believe me, changes are VERY often required. Schools make so many changes, and they change the EFC a little, a lot or not at all. To be honest, it’s more time consuming to try to explain that a change was made than it is to just change it & package aid accordingly. So many times it doesn’t make any difference in the amount of aid a student receives, so it’s not an issue, anyway. The only time I explained a change to a student without being asked was when a freshman got an estimated aid package pending verification - and verification resulted in a change to aid. I would reach out with an explanation because aid had changed. If verification resulted in a change to EFC but aid stayed the same, there was no reason to explain anything. If I changed something before aid was awarded, I didn’t reach out with an explanation … per regulations, I had to make the required changes, but the student didn’t experience any type of change, since aid hadn’t yet been awarded. Federal regulations require that schools note any changes in the student’s file, so if someone wondered why the EFC changed, they could call & we could look in the file.
In your case, schools are prepping aid packages ahead of decisions. It’s likely a college that has your tax documents. A small EFC change is often the result of incorrectly reporting income from work on the FAFSA - a school that has your W-2s and tax forms would see that & make updates to the FAFSA. There are other possible reasons, but this one comes to mind.
I’m the OP, coming back with an update. I ended up calling most, but not all, of the schools my daughter applied to. I still haven’t figured out which school it was (every school I spoke with said it wasn’t them). However, thanks to very helpful FAOs at two of the schools, I did learn that:
As others here suggested, I did make a mistake in what I reported for contributions to retirement accounts, and that was easily confirmed through our W-2s. (I did have the amount correct on the CSS Profile.)
When I called, one of the schools’ FAOs took the time to log in and read me all the things that had been changed. Although I still have not been able to find a simple way to see what was changed in each separate corrected version of the FAFSA, I did download a new SAR and compare it to the SAR I had previous saved—so I was able to compare them side-by-side to see the original numbers and the updated ones. And what I saw was that whoever had made the changes, had taken corresponding amounts from the CSS Profile (for student and parent investment net worth) and put those amounts into our FAFSA, overwriting what I’d already entered in the FAFSA.
Now here’s where it gets frustrating: I filled out the FAFSA in Oct. 2022, and I filled out the CSS Profile a full month later, in Nov. 2022. As @kelsmom noted above, the FAFSA instructions are to enter amounts that are accurate as of the day you submit it, which was what I had done. So this mystery FAO that used the CSS Profile numbers (from November) to “correct” my FAFSA (from October) was introducing an error. This is non-trivial because, while our investments did go up in November, they went up because we took money from our checking/savings to invest. On the CSS, yes, our investments went up, and our bank accounts went down as a result. So when the mystery FAO “corrected” the investment amount on our FAFSA and didn’t change our checking/savings amounts, they were essentially double-counting some of our money!
I corrected the FAFSA back to the original amounts (accurate as of Oct. 2022), and then I sent emails to the financial aid offices of each school my kid applied to, letting them know what had happened. I honestly don’t know whether any of this made a difference. Some of the schools had already calculated our aid based on the original FAFSA and had no idea what I was talking about. I just hope this message reached whichever school it was that made the erroneous change. (At least I know it was one of the private schools, since it was clearly based on the CSS Profile.)
The moral of this long story is: If a change is made by a school, you should figure out what the change was (which you can do by comparing the new SAR to your original one, assuming you saved the original one)—because FAOs can and do make mistakes that can affect your EFC!
Sorry - I shouldn’t have been so abrupt. There is so much financial aid office bashing out there, and so often it’s not warranted. They’re just doing their jobs. But yes, they do make mistakes, so it’s wise to ask about changes if they would affect aid.
Financial aid is a field that demands expertise, but it’s poorly paid. Financial aid offices are increasingly understaffed, and I suspect increasingly undertrained. I am retired but have considered doing short term assignments. When I read the job descriptions & see the pay, it’s a hard no. Unfortunately, I don’t think it’s going to get better in the near future … so if you think something is wrong, push for answers.
I’m here with an update! Thank you to so many of you above who helped me figure out what to do, which was get my daughter to log in and find that place where you can see the “Corrections History.” So while I’m still so very curious about what we did wrong (it must have been something small) and which school went in to make the correction for us, the upshot is that apparently our EFC is a whopping $92 less that originally estimated based on what we put in. So no harm, no foul.
Quick question for @kelsmom or someone else knowledgeable: the EFC just pertains to THAT child for the next year, right? And that has taken into consideration what we reported that we are paying for her brother who is already in college? So if we get a certain EFC for child #2, in truth FAFSA thinks we can pay that EFC + the tuition we are already paying for child #1?
FAFSA is for that child only, so the EFC is for that one child, got current financial aid year only. This year, your FAFSA EFC is roughly split in half for each child (with some differences based on individual child’s earnings/assets). Next year, that won’t happen … there won’t be any adjustment on FAFSA for having more than one child in school. Schools may or may not choose to consider additional kids in college when awarding their own aid.
P.S. look at the corrections - did mom & dad’s income from work get changed? Just wondering for my own knowledge … I have been away from financial aid for a few years & am hoping I’ve “still got it.”
