Student Aid Application Process

Every year, millions of students rely on student aid to help pay for their college education. Unfortunately, the process is confusing and time-consuming. There are 9 federal, 605 state, and nearly 8,000 college aid programs. Most students are eligible for some aid. Here's a quick overview to help you understand how student aid works.

1. You prepare a student aid application. Most aid starts with the federal student aid application (FAFSA) – a form that asks many household income, asset, and dependency questions. Your parents will probably want to answer most of them. Tell your parents or guardians that they don't have to file their income taxes before they complete your FAFSA. It's okay if they estimate earnings based on their previous year's income just to get your FAFSA into the system early. That way, your place in the student aid line is secure. Later, when they file their federal income taxes, they can revise your FAFSA with final numbers.

   Each college determines your aid eligibility and award amount based on the information you provide for your FAFSA. Competition for aid is fierce, and most of it is awarded on a first-come, first-served basis. Submit your FAFSA as soon as possible after January 1st so you don't miss out on any student aid! Many state and college programs also require additional forms (e.g., CSS Profile).

2. The federal government calculates your EFC. The federal government doesn't tell you how much aid you will receive – colleges do. The federal government calculates what's called your expected family contribution (EFC), which is the amount it says your family is expected to pay toward your education expenses. Your EFC and each college's published cost of attendance (COA) (also called the "sticker price") determine your financial need, eligibility, and award amounts.

   Remember, your EFC is not necessarily the amount of money you must come up with immediately to pay for college. Funding sources such as student loans and work-study programs can offset your net ("out-of-pocket") cost. Of course, loans must be repaid after you leave college.

3. Your need is determined. Some aid is based on merit (grades and accomplishments), but most aid is based on "need," which means that you must demonstrate financial need to be eligible. Your financial need is calculated based on your EFC and the published cost of attendance for the colleges you apply to.

4. Colleges access your information. Once your student aid application is processed, administrators at the colleges that have accepted you will access the personal and financial data you provided on your FAFSA to determine your student aid eligibility and award amounts.

5. Colleges determine your eligibility and award amounts. Colleges decide aid awards based on your need and how much aid they have to offer. You will receive a financial aid award letter from each college that accepts you (generally in March or April for "traditional" students). Colleges are often open to reconsidering your award if something about your financial status changes for the worse – e.g., if a parent's job is eliminated.

6. Apply early for student aid every year. Nearly everyone is eligible for some type of aid. Millions of students apply for the billions of dollars available. Don't get left out. If you want to get the most aid possible, you should apply as close to January 1st as you can. Most federal, state, and college aid programs require that you reapply for aid each year. The aid "window" for each academic year stays open 18 months, so if your family runs into a financial problem during the first semester, there's still time to request more aid for the current academic year. Aid may also pay some costs retroactively.

Additional Resources:

• Find out about your student aid eligibility and net cost estimates by college, years before you apply, with a College Cost & Planning Report™
• Learn about federal financial aid programs, such as grants, loans, and tax-based aid
• Learn about private scholarships