For many states including California, the timeline for filing for financial aid is getting down to the wire. For those who are late to the party here are some financial aid tips and tricks to filing a FAFSA for the 2014-2015 year.
Tip: Pay Attention to Deadlines
As with class assignments, paying attention to deadlines is the one of the most crucial details of the financial aid process. Although the federal deadline is June 30th annually, many states require students to prepare well ahead of that date, setting shorter time lines for filing the FAFSA. Schools may have additional variances in preferred filing time lines so students are encouraged to check all sources. For many nontraditional students that attend online classes, living in one state while attending a school in another, the most important fact to remember is that state of residence determines when financial aid applications are due.
For example, Brandman University, a private and nonprofit institution, offers fully online programs and students live in many states across the country. For California residents the initial filing date is March 2, and the school prefers such as well, but for students residing in Vermont or Washington state early submission determines availability.
These two states are part of a set of 7 regions that award aid on a first-come, first-serve basis until funds are fully depleted. Others following this rule include Illinois, Kentucky, North Carolina, South Carolina and Tennessee. In these cases filing early is the primary factor for determining financial aid qualification. So remember: Check school, state of residence and federal deadlines during the financial aid planning process.
Trick: Manage Your Adjusted Gross Income and Liquid Assets
Adjusted Gross Income (AGI) equals income less adjustments. This simple formula can determine the amount of financial aid you are eligible for. Generally speaking, the higher the family's AGI, the less financial aid a student will receive. Given the calculation, unless families result to reducing household income, which of course is not a popular option, the best course of action would be to increase adjustments. A good accountant or tax professional can help you through this process.
AGI is not the only formula in the financial aid process. The federal government has entire algorithms that contribute to evaluating need based loans, grants and other forms of aid. The FAFSA's formula for determining Expected Family Contribution (EFC) relies heavily on the amount of liquid assets in a family including bank accounts. Although it is of course not recommended to give away cash or money in savings and checking accounts, shifting assets or paying off large debt balances such as a mortgage may help limit liquid assets. This is strategy is particularly helpful for big savers and big spenders. College Board provides a financial calculator to help families estimate their EFC.
Tip: Preparation and Practice Makes Perfect
Practicing filling out the FAFSA is a great away to prepare for the nuances of the application. Studentaid.gov provides a yearly FAFSA on the Web Worksheet to help students collect all of the necessary information prior to submitting the real thing. This tool provides a preview of questions tasked on the actual application. Although it may be obvious to some, the live application does not function like an SAT exam that only gives credit to answered questions. Leave no entry on the form blank. If the answer is not applicable or a dollar amount cannot be attributed, fill the section with a 0. This tip is generally for those filling out the traditional paper version of the form, since the online version will not allow you to proceed without entering a value (hint: the online version is faster and easier).
Be sure to set aside enough time to complete the full FAFSA application, which has around 130 questions relating to the student and their family's financial status including income, household size, number of siblings in college and more. Most questions are straight forward such as social security number and citizenship, while others may require more time to collect the necessary information and documentation.
Trick: Use a Supplementary Letter to Explain Extenuating Circumstances
Although the FAFSA is designed to be as inclusive of details as possible, it does not provide a section to allow students to explain special circumstances such as recent unemployment or high medical bills. If there extenuating circumstances in your personal financial situation send a supplementary letter explaining the issues. According to an article published by TIME, a senior adviser at College Confidential says, "The FAFSA is a critical document, but it isn’t the only document. Many colleges will respond in a holistic way when extenuating circumstances are spelled out to them."
Whatever the circumstance may be, remember it is important to provide documentation, preferably from a third party to confirm your claims. In the example of high medical bills, items such as invoices or credit statements can help build a case for financial-need.
The Bottom Line
Remember that your school, financial advisors and FAFSA staff can be relevant resources when planning ahead. Many schools, like our example of Brandman University, follow the One Stop student services model. Find out what services your school provides for assistance. Share these quick financial aid tips and tricks with your friends and family and get started today:
- Find out your school, state of residence and federal deadlines before applying.
- Adjust and spend where needed to use federal formulas to your advantage.
- Plan ahead and practice before filling out the official form.
- Explain any circumstances that may not be included as part of the FAFSA.