Did you know that the U.S. Department of Education awarded approximately $112 billion in federal grants, loans, and work-study funds to more than 10.1 million students in the fiscal year 2021 (Federal Student Aid annual report)?
That’s fantastic! Right? On the other hand, according to a new National College Attainment Network (NCAN) analysis, the high school class of 2021 left an estimated $3.75 billion in Pell Grants on the table by not completing the Free Application for Federal Student Aid (FAFSA). This is alarming because the Pell Grant is a needs-based grant available to low-income students who often face historical and structural inequities and by not filling out the FAFSA, the opportunity gap only widens.
As NCAN points out, “Without sufficient financial aid, students take out more loans to afford the cost of college. This burden falls heavily on Black students, who for a variety of reasons (such as the racial wealth gap) borrow at higher rates than their peers.” In school, students look to their advisors to provide them with direction toward their career and educational goals. One way for advisors to accomplish this is to educate students about the FAFSA. By using Money Path, a powerful academic and career-planning tool, advisors can help their students see the importance of filling out the FAFSA.
The 2022-2023 FAFSA opened on October 1, 2021 and will close on June 30, 2023. The warmth of sunshine on your skin and the sounds of birds chirping may seem far away, but summer will be here before you know it and the importance of financial aid is clear. The following are 5 tips to help prepare your students for filling out the FAFSA:
1. Create a Federal Student Aid (FSA) ID
The FSA ID is an account username and password needed to sign the FAFSA form online. Both the student and the parent of a dependent student will need to create their own FSA IDs. To do this, they will need to have their Social Security number, mobile phone number, and/or email address. It is recommended that students and parents create their separate accounts early to avoid delays because it can take up to three days before they can use their FSA IDs.
2. Gather Personal Financial Information
Let your students know that they will need federal tax returns, W-2s, bank statements (both checking and savings), and any records of investments. If they are a dependent student, they will need this information for both their parents and themselves. Since this information can be time-consuming to gather, it is best to find it all prior to sitting down and filling out the FAFSA. For the 2022-2023 FAFSA, students and their parents will need their 2020 tax forms. Data from that tax year is used as a predictor of the family’s financial situation for the current year. The Money Path app allows students to enter their family’s income level to estimate their financial aid and provides valuable facts about financial aid and the different types available.
3. Make a List of Schools They’re Interested in Attending
There’s room for 10 schools on the FAFSA. Encourage students to make a list of all schools they’re considering attending even if they haven’t sent an application yet. It doesn’t hurt their application to add more schools and if they decide later to not apply or do not get accepted, the school will just disregard their FAFSA form. If the student wants to send the FAFSA to more than 10 schools they can go into their form, delete out schools and add more once it has been processed (they should wait to receive confirmation of this). Encourage them to complete the FAFSA for the colleges with the earliest deadlines first. Money Path can help them narrow their college search to be able to enter those schools that they think are most affordable for them on the FAFSA.
4. Know Parent Demographics
For dependent students, parents will need to provide basic demographic information. It’s important that the students know who counts as a parent on the form prior to filling it out. If the student’s parents are married to each other, information should be reported for both. If their parents live together but were never married, are divorced, or are separated, they still need to provide information for both. And if their parent remarried, they would need to report information for their stepparent.
5. Avoid Common Mistakes
Filling out the FAFSA incorrectly can delay your student’s application and impact the amount of money they’re eligible for so it’s important for them to be aware of common mistakes. The National Association of Student Financial Aid Administrators keeps a running list, here are a few of them:
- Leaving blank fields. Enter a ‘0’ or ‘not applicable’ instead of leaving a blank.
- Using commas or decimal points in numeric fields. Always round to the nearest dollar.
- Forgetting to list the college they’ve applied to or are considering applying to.
- Forgetting to sign and date the form. If not signed and dated the form is incomplete.
By implementing these 5 tips and using the Money Path app to educate students about the importance of filling out the FAFSA, students, especially historically marginalized students from under-resourced areas, can have access to hundreds or even thousands of dollars that will help lower their college costs. Money Path can also help students determine how much funding they’ll need (from savings, scholarships, or family) in addition to federal financial aid, to cover the cost of college, and it gives them the ability to compare in-state vs out-of-state tuition and two-year vs four-year colleges.
“I appreciate what Money Path offers our students. Students learn firsthand how income from their future job impacts their budgets and life-long goals. Choosing a college major and seeing salary and career opportunities along with the percentage of people employed in that field has been very influential in guiding students into a career that can provide them with not only the income desired, but the job outlook as well.” – Shelby Kaisershot – School Counselor, Pulaski High School
Money Path is currently available at no cost to Wisconsin school districts thanks to generous sponsors. To learn more about Money Path and prepare your students for life after high school register for one of our upcoming 30-minute webinars today!