[Length: 6 Minute Read]
With the October 1, start of the 2020-2021 college application season, I’ve created a 2-part series called “Filling out the FAFSA” to guide you through the process. This post will help you understand what FAFSA is, why it’s important to fill it out, what specific information you need, and steps you need to take to fill it out all out.
What Is FAFSA?
As mentioned in our FAFSA FAQ #1 Video, FAFSA stands for “Free Application for Federal Student Aid.” By filling out the FAFSA, your child becomes eligible to receive Federal student aid in the form of loans, grants, work-study programs.
College is expensive these days, and these federal aid programs are designed to help families reduce the cost of attending college. Famlies that are in need can qualify for what’s called a GRANT, which is a form of financial aid the student can receive but doesn’t have to pay back.
Additionally, filling out the FAFSA opens the door to obtaining Federal student loans, which tend to be cheaper than private student loans and qualify for loan forgiveness programs. Clearly, you want to be careful in having your child take out student loans, as they can become a crushing burden for students when they graduate. But these Federal loans can help bridge the gap between money saved up to pay for college and the ultimate cost of sending your child to college.
Who Should Fill Out The FAFSA?
In short, everyone. Many parents fall into the trap of assuming that they earn too much money or have too many assets to qualify for any form of Federal student aid. That may end up being the case for you, but filling out the FAFSA is important nonetheless for a number of good reasons:
- Many schools that issue merit-based awards require the applicant to have completed the FAFSA form;
- If your child needs access to Federal student loans, or if you as the parent need access to Parent PLUS loans to help pay for college, you need to fill out the FAFSA;
- If you encounter a job loss or sudden change of income, you can ask the school to reexamine your eligibility for financial aid – but only if you already have a completed FAFSA on file;
- Some states offer their own financial aid and require students to fill out the FAFSA in order to get it;
- If your child is eager to enter public service or become a teacher, then considering Federal student loans might be a good option as there are debt forgiveness programs for these professions.
In short, there are a lot of good reasons to fill out the FAFSA even if it’s unlikely your student will receive any grants or merit-based scholarships.
Before October 1: Get your FSA ID (Federal Student Aid ID) prior to filling out the FAFSA. An FSA ID is required if you want to fill out and sign the FAFSA online and make online changes later.
October 1: The first day that prospective students and parents can start filling out the FAFSA
Deadline: Depends on the schools your child is applying to. My suggestion would be to fill out the FAFSA early on (October) so you have it done and out of the way. You can always go back and revise data or school choices if needed.
Getting Your FSA ID
Before you can fill out the FAFSA online, you need to first obtain an FSA ID. While you can technically fill out the FAFSA online without an FSA ID, you would then have to print, sign and send the form manually. Save yourself the hassle by getting an FSA ID.
Who needs to get an FSA ID: the student, the parent, or both? Definitely, the student. For parents, it depends. If the student is a dependent of the parent(s), then one of the parents will have to get an FSA ID as well in order to sign off on the student’s FAFSA form. If the student is not a dependent, then the parent should only get an FSA ID if they intend to take out Parent PLUS loans to help their child pay for college.
The student (and parent, if necessary) will need an email address, mailing address, and Social Security Number in order to get an FSA ID. It is also recommended to link your mobile phone number to this ID as well in case you have to reset passwords.
Below, I will you through screenshots of the entire FSA ID process so you know what to expect when you go to do it.
First, go to the FSA website at https://fsaid.ed.gov/
Step 1: Create Username And Password
Step 2: Enter Name, Date of Birth And Social Security Number
Step 3: Enter Mailing Address And Mobile Phone Number
Step 4: Fill Out Your Challenge Questions
When you get to this screen, you will have to choose your question for Challenge Questions 1 and 2. As you scroll down this screen, you will read the terms & conditions of getting your FSA ID. In order to proceed, you will have to check the box to certify that you agree to the terms and then hit Continue, as seen below.
Step 5: Confirm And Verify Information
Step 6: Verify Mobile Phone Number And Submit
Finally, in this step you’ll receive a verification code to confirm your mobile phone number. Enter the code and click “Verify” and the you’ll be ready to submit the form on the next screen!
You are now ready to fill out the FAFSA form when the application window opens on October 1.
Next week, we will tackle filling out the FAFSA form. Quick preview: it’s not too painful. With the checklist I’ll provide, you and your student will be ready to get the FAFSA form filled out so they get to the fun part of filling out college applications!
Wondering how this affects your investments? Schedule a call with Financial Design Studio to discuss your portfolio today.