There are recent and upcoming changes to the FAFSA in an effort to make the FAFSA easier to complete. The goal is to encourage low income students to file FAFSA. Federal aid is geared to benefit the neediest students, so making FAFSA simpler will hopefully result in fewer hoops for low income families. Non tax filers in particular have had difficulty understanding the FAFSA requirements, and verification of low income families rarely changes the EFC. So … the changes we have heard about are being phased in, and the impact of changes will benefit some & not so much, others. For a really good read about expected impact, this is an excellent study: https://www.nasfaa.org/uploads/documents/SAI_Case_Studies.pdf.
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Thank you. These cases are very interesting. My own family will probably find these changes to be neutral or we may even be helped if my younger children end up going to schools. that only use the FAFSA; certainly it is a relief to discover we won’t be hurt.
It will also be interesting to see how schools that use the CSS may (or may not) change their calculations. I imagine that some colleges may choose to try to correct for example 2 (“Applicant Loses Pell Grant Eligibility Due to Change in Treatment of Multiple Family Members in College”) and the completely wild but unlikely example 7 (“parents earn $26,500 and have $8.5 million in assets”).
In example 2, the upper middle class family with 3 children in college will no longer be eligible for even a small pell grant while the family in example 7 with a low income but very high assets would be eligible for a maximum grant (in the unlikely circumstance that their tax return does not include various schedules). I wonder if people will perceive example 7 families as gaming the system? On the one hand, as long as a family is following the rules then maybe it is fine that a millionaire household could potentially qualify for a pell grant. On the other hand, that scenario seems horrifying to me and I suspect that an extraordinarily wealthy enough family might find a way to plan ahead so that their income appears very low. No family living from paycheck to paycheck could drop their income and hide their assets completely 2 years in advance of the child’s aid application.
Keep in mind that the purpose of the FAFSA Simplification Act is to make it easier to apply for federal aid (and to understand how it works, although that’s still not simple). To do this, there will be those cases on the margins that don’t seem fair. The number of people who will benefit from scenario 7 is statistically insignificant, and the change will have a positive effect on so many more families. I learned early on in my financial aid career to “let it go” when I came across something that seemed unfair … because if one seemingly un-needy family benefits in order to help hundreds or thousands, it’s an overall good thing. There have always been a few who get the Pell because of write offs that lower AGI, but you can’t make rules that cover every situation (without getting a mess like the tax code, which definitely isn’t simple and still isn’t fair).
To clarify, I actually agree with all of the above. There will always be a handful of outliers with odd circumstances, not just in the case of education policy but in all types of federal and state policies. I am just musing about whether the optics will make some families frustrated --particularly those with multiple children in college who may be losing a benefit that they had under the old formula. In other words, I am not personally concerned about the (tiny number of) families who might fall under example 7. But I am curious about whether those outliers may drive a backlash or an increase public perception that the system is unfair.
On the other hand, perhaps there will be no outcries of unfairness. I do think it is interesting that often when there is a public backlash towards a policy initiative or benefit, I hear a lot more anger expressed about people that have been labeled as lower-income “cheats” (as in welfare queen stereotyping) than anger expressed about upper or middle income folks who are benefiting from the same policy.
I was still working in financial aid when the Department of Education was working on FAFSA simplification. They were very data driven in making changes, so I am hopeful that the changes will result in enough good stories that the overall optics will be positive. Only time will tell, though.
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