As a graduate student, I‘m no stranger to filing the Free Application for Federal Student Aid (FAFSA®), and when I filed my 2016-17 FAFSA, I was prompted to create an FSA ID—the username and password you need to log in to the FAFSA. I followed the step-by-step instructions, and voila! I easily created my very own FSA ID in no time!
More than 30 million FSA IDs have been created, and people, like me, have used their FSA ID more than 146 million* times. With any new process, there are some myths floating around about creating and using an FSA ID. Let’s tackle some of those right now…
When I was in my last semester of high school, I checked my family’s mailbox just as much as I checked Snapchat and Instagram combined. It was the season of admissions decisions, and I was getting letters from all the colleges I’d applied to.
But once I’d gotten into several schools, my attention shifted to my e-mail inbox. I was waiting on information that was just as critical: my financial aid offer from each college. I knew that for me, the amount of financial aid I got from a school mattered just as much as the general admissions decision. I’d fallen in love with each of the schools I’d visited, and I knew I’d be happy anywhere. Basically, my choice was going to come down to the money.
Analyzing different aid packages can seem like way too much math for the end of your senior year—at least it did to me—but it’s important stuff. Check out my four steps to make this analysis simpler.
What to do once you get an aid offer
1. Make sure you know what you’re looking at.
The financial aid offer (sometimes called an award letter) typically comes in an e-mail from the college’s financial aid office. The offer includes the types and amounts of financial aid you’re eligible to receive from federal, state, private, and school sources. Be sure you understand what each type of aid is and whether it needs to be paid back. For example, when I got into UNC-Chapel Hill, my aid offer was a mix of scholarships, which I didn’t need to pay back, and private loans, which I did. My offer from Duke (booooo) had mainly the same stuff with some grant money mixed in.
Click to download PDF.
Lucky for you, hundreds of colleges nationwide have signed on to present financial aid offers in a standardized format known as the Shopping Sheet. The Shopping Sheet is a standardized award letter template that makes it easy to compare financial aid offers from different schools. In addition to providing personalized information on financial aid and net costs, the Shopping Sheet also provides general information on the college, like graduation rate and loan default rate.
Today, more than ever before, a college diploma or job-training credential is one of the best investments you can make in your future. By some estimates, a bachelor’s degree is worth an average of a million dollars over the course of your lifetime.
But college also has never been more expensive, and far too many Americans are struggling to pay off their student loan debt.
Maybe you haven’t quite landed that dream job in your field of study yet. Or you decided to go into public service instead of taking the highest-paying offer. Your reward for investing your time and money in the skills and knowledge needed to secure your future shouldn’t be a sky-high monthly payment.
Generally, the first step in applying for financial aid is completing the Free Application for Federal Student Aid (FAFSA). The schools you listed on the FAFSA will take that information and use it to calculate the financial aid you’re eligible for. Your financial aid awards may vary from school to school based on a number of factors including: your Expected Family Contribution (EFC), the number of credits you will take each term, your cost of attendance (COA) at each school, your eligibility for state and institutional aid at each school, and your year in school. Keep in mind that many schools have a priority deadline, so the sooner you apply each year, the better. Here are 5 things that will help you better understand how financial aid is awarded:
We all know college is super expensive; not only do you have to pay tuition, but there’s also room and board (for those of you staying on campus), a meal plan (yay for cafeteria food…), and textbooks (buying hundred-dollar books for one chapter). It’s a lot. Luckily for us, there’s help: scholarships! Of course there’s no guarantee that you’ll actually be awarded any money, and sometimes it can seem like a whole lot of work for a whole lot of nothing. But that’s why I’m here! I’ve gone through the process recently (and am doing it again), and I’m at your service with suggestions and tips.
A lot of these tips come from StudentAid.gov/scholarships, so check out that page for a more comprehensive, detailed guide to scholarships.
Types of Scholarships
There are scholarships for almost everything—all you have to do is look. Applying for scholarships doesn’t have to be tedious—find scholarships for things you’re passionate about. Some scholarships are really cool. There are scholarships for animal rescue, volunteering with the elderly, etc.; you can find them through specific organizations, too.
A college or career school education = more money, more job options, and more freedom. Yet, with more than 7,000 colleges and universities nationwide, deciding which college is right for you can be difficult. Maybe you want to find a school with the best nursing program, or study abroad options, or the best college basketball team; every person values different things. However, it’s also important to remember that college is one of the biggest financial investments you will make in yourself. Just as important as academics and extracurricular activities are the financial factors: how much a college costs, whether students are likely to graduate on time, and, if alumni are able to find good jobs and pay off their loans. That is why the U.S. Department of Education developed the College Scorecard. It provides clear information to answer all of your questions regarding college costs, graduation, debt, and post-college earnings.
As you’re comparing colleges, use the College Scorecard to compare these four things:
1. Net Cost
For starters, you should consider how much you’ll actually be paying on an annual basis. That’s not necessarily the sticker price, but it’s the sticker price minus all of the scholarships and grants that you will receive when enrolling in an institution. This is called the net price, and it’s important because it’s the average amount students actually pay out of pocket.The College Scorecard can show you the average net price of each school compared to the national average. It can also give you a net price estimate for each school broken down by family income. Here’s an example:
Student loans, interest payments, and taxes: three things that have scared many people for years now. Read on to learn how these things can benefit you. Just as Dorothy, the Scarecrow, the Cowardly Lion, and the Tin Man learned when they followed the yellow brick road, once you look at the bigger picture you’ll realize you had the resources to face your fears all along!
If you made federal student loan payments in 2015, you may be eligible to deduct a portion of the interest paid on your 2015 federal tax return. This is known as a student loan interest deduction. Don’t miss out on this opportunity to make the money you’ve paid work for you! Below are some questions and answers to help you learn more about reporting student loan interest payments from IRS Form 1098-E on your 2015 taxes and potentially get this deduction.
What is IRS Form 1098-E?
IRS Form 1098-E is the Student Loan Interest Statement that your federal loan servicer will use to report student loan interest payments to both the Internal Revenue Service (IRS) and to you.
Will I receive a 1098-E?
If you paid $600 or more in interest to a federal loan servicer during the tax year, you will receive at least one 1098-E.
The IRS only requires federal loan servicers to report payments on IRS Form 1098-E if the interest received from the borrower in the tax year was $600 or more, although some federal loan servicers still send 1098-Es to borrowers who paid less than that.
If you paid less than $600 in interest to a federal loan servicer during the tax year and do not receive a 1098-E, you may contact your servicer for the exact amount of interest you paid during the year so you can then report that amount on your taxes.
How many 2015 1098-Es should I expect to receive?
That depends on how much you paid in interest, how many federal loan servicers you had, and some other factors. Read through the scenarios below to find where you fit and know how many 2015 1098-Es you should expect.
Your current servicer was your only servicer in 2015: In this case, your current federal loan servicer will provide you with a copy of your 1098-E if you paid interest of $600 or more in 2015. Your servicer may send your 1098-E to you electronically or via U.S. mail.
You had multiple servicers in 2015: In this case, each of your federal loan servicers will provide you with a copy of your 1098-E if you paid interest of $600 or more to that individual servicer in 2015. Your servicer may send your 1098-E to you electronically or via U.S. mail.
If you paid less than $600 in interest to any of your federal loan servicers, you may need to contact each servicer as necessary to find out the exact amount of interest you paid during the year.
How will reporting my student loan interest payments on my 2015 taxes benefit me?
Reporting the amount of student loan interest you paid in 2015 on your federal tax return may count as a deduction. A deduction reduces the amount of your income that is subject to tax, which may benefit you by reducing the amount of tax you may have to pay.
Now that you know student loans, interest rates, and taxes aren’t as scary as you may have originally thought, you are ready to report your student loan interest rates on your 2015 federal tax return!
But what if I still need help or have more questions?
While we are not tax advisors and cannot advise you on your federal tax return questions, your federal loan servicer is available to assist you with any questions about your student loans, including questions about IRS Form 1098-E and reporting the student loan interest you’ve paid on your 2015 taxes. If you’re not sure who your loan servicer is, visit My Federal Student Aid to find contact information for the loan servicer or lender for your loans. To see a list of our federal loan servicers, go to the Loan Servicers page on StudentAid.gov.
Noemi Solares is a Management and Program Analyst at Federal Student Aid.
I’ll admit it. February is not my favorite month because it reminds me of tax returns, bad weather and well, finding my tax information. Ugh. If you are like me, a world-class procrastinator that agonizes every year at the thought of filing a tax return and submitting a FAFSA®, then you are not alone. You also know that it can be time consuming. So, here is why you should use the IRS Data Retrieval Tool (DRT) to instantly transfer your tax information directly into your FAFSA:
1. What is the IRS DRT and how do I use it?
You can find the IRS DRT in the “Financial Information” section of the FAFSA. To use the tool, be sure to indicate that you already completed your tax return. Answer the remaining questions and log in using your FSA ID:
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If your tax return information is available and if you are eligible to use it, you will be transferred to the tool. Make sure to provide your information exactly as you provided it on your tax return:
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You will be able to preview your tax information before agreeing to have it directly transferred to your FAFSA.
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When you return to the FAFSA, you’ll see the relevant questions populated with your information automatically. It’s that easy!
2. Why use this tool?
It’s so easy that it only takes a couple of clicks to transfer all your tax information.
It can be used by both students and parents.
Most importantly, it is accurate so you don’t have to worry about entering the wrong tax information on your FAFSA.
4. If I already completed the FAFSA using estimates, can I use the IRS DRT to update my FAFSA once I filed my taxes?
Yes, if you estimated, you will have to update your FAFSA once you have filed your taxes anyway. So why not use the IRS DRT? It’s the easiest way to update your FAFSA. To update your estimates, click “Make FAFSA Corrections” after logging in to fafsa.gov. Navigate to the “Financial Information” section and indicate that you have already completed your taxes. If your tax return information is available and if you are eligible to do so, you should follow the same prompts listed above to transfer your tax return information to your application.
5. Why can’t I use the IRS DRT?
If you’re not seeing the IRS DRT, there may be a few reasons why:
It is not available for use yet.
You indicated that you will file or are not going to file a federal income tax return.
Your marital status changed after Dec. 31 of the previous calendar year.
The student/parent filed a Form 1040X amended tax return.
The student/parent filed a Puerto Rican or foreign tax return.
If you are not able to use the IRS DRT, don’t worry. Although you’ll be required to enter your tax information manually, we have great resources on StudentAid.gov that walk you through the process.
Now that you know the secret to transferring your tax information to the FAFSA, I hope you will enjoy the time you saved!
Zelma Barrett is a Management and Program Analyst at Federal Student Aid.
Congratulations! You submitted your 2016–17 Free Application for Federal Student Aid (FAFSA®)! Wondering what happens next? Here are a few things to look out for:
1. Review Your Student Aid Report (SAR)
After you submit your FAFSA, you’ll get a Student Aid Report (SAR). Your SAR is a summary of the FAFSA data you submitted. Once you have submitted your FAFSA, you’ll get your SAR within three days (if you signed your FAFSA online) or three weeks (if you mailed a signature page.)
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Any student with an FSA ID can view and print his or her SAR by logging in to fafsa.gov and clicking on the appropriate school year. This is also where you can check the status of your application if you have not received your SAR yet. Once you get your SAR, you should review it carefully to make sure it’s correct and complete.
2. Review Your EFC
When reviewing your SAR, look for the Expected Family Contribution (EFC) number. Your EFC can be found in the box at the top of the first page of your SAR, under your Social Security number.
Your EFC is a measure of your family’s financial strength and is calculated according to a formula established by law. This formula considers the following about you (and your parents, if you’re dependent):
Taxed and untaxed income
Benefits (such as unemployment or Social Security)
Number of family members who will attend college during the year
Schools use your EFC to determine your federal student aid eligibility and your financial aid award. However, it’s important to remember that your EFC is not the amount of money your family will have to pay for college nor is it the amount of federal student aid you will receive. It is a number used by your school to calculate how much financial aid you are eligible to receive. Contact your school’s financial aid office if you have any questions about how they calculate financial aid.
3. Make Corrections If You Need To
It’s important to make sure that everything on your FAFSA is correct and complete, as your school may ask you to verify some of the information. Most of the questions on the FAFSA want to know your situation as of the day you sign the FAFSA. However, there are some instances in which you’ll want to (or be required to) change the information you reported.
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TIP: You must wait for your most recent FAFSA submission to process before you can update or make corrections to your FAFSA. That usually take about three days.
Most FAFSA information cannot be updated because it must be accurate as of the day you originally signed your FAFSA. However, there are certain items that you must update. If there will be a significant change in your or your parent’s income for the present year or if your family has other circumstances that cannot be reported on the FAFSA, you should speak to the financial aid office at the school you plan to attend.
4. Review Your Financial Aid History
The last page of your SAR includes information about your financial aid history, specifically the student loans you have taken out. It’s important to keep track of how much you’re borrowing and to understand the terms and conditions of the loan.
TIP: You can always access your financial aid history by logging into My Federal Student Aid. Make sure you have your FSA ID ready.
5. Double-Check With Your Schools
Lastly, make sure that you double-check with the financial aid offices at the schools you applied to. Sometimes schools need additional paperwork or have other deadlines. You never want to leave money on the table!
Here’s a video on what happens after the FAFSA. You can find more videos on our YouTube channel.
Sandra Vuong is a Digital Engagement Strategist at Federal Student Aid.
Ah, deadlines. The sworn enemy of students across the nation. When you’re busy with classes, extracurricular activities, and a social life in whatever time you’ve got left, it’s easy to lose track and let due dates start whooshing by. All of a sudden, your U.S. history paper is due at midnight, and you still don’t know Madison from a minuteman. We get it.
Nevertheless, we’re here to point out a few critical deadlines that you really shouldn’t miss: those to do with the Free Application for Federal Student Aid (FAFSA®). By submitting your FAFSA late, you might be forfeiting big money that can help you pay for college. Luckily for you, you’ve got just three types of deadlines to stay on top of. Now if only your Founding Father flashcards were that simple.
Here are those three deadlines:
The College Deadline
The first type of deadline comes from colleges themselves, and—spoiler alert—it’s typically pretty early. These deadlines vary from school to school, but they usually come well before the academic year starts, many in the neighborhood of early spring. If you’re applying to multiple colleges, be sure to look up each school’s FAFSA deadline and apply by the earliest one.
Many of these FAFSA due dates are priority deadlines. This means that you need to get your FAFSA in by that date to be considered for the most money. Many colleges have this date clearly marked on their financial aid pages. If you can’t find it, a call to the college’s financial aid office never goes amiss.
The State Deadline
The second deadline is determined by your home state. This deadline varies by state and can be as early as February 15 of a given year’s FAFSA application cycle (What’s good, Connecticut?). Some states have suggested deadlines to make sure you get priority consideration for college money, and some just want you to get the FAFSA in as soon as you can. States often award aid until they run out of money—first come, first served—so apply early.
This last deadline comes from us, the Department of Education, aka the FAFSA folks. This one is pretty low-pressure. Our only time constraint is that each year’s FAFSA becomes unavailable on June 30 at the end of the academic year it applies to.
That means that the 2016–17 FAFSA (which became available Jan. 1, 2016) will disappear from fafsa.gov on June 30, 2017, because that’s the end of the 2016–17 school year. That’s right; you can technically go through your entire year at college before accessing the FAFSA. However, a few federal student aid programs have limited funds, so be sure to apply as soon as you can. Also, as we said, earlier deadlines from states and colleges make waiting a bad idea.
Why so many deadlines?
All these entities award their financial aid money differently and at different times. What they all have in common, though, is that they use the FAFSA to assess eligibility for their aid programs. So when a college wants to get its aid squared away before the academic year starts, it needs your FAFSA to make that happen. If you want in on that college money, you need to help the college out by getting your information in by its deadline. Same goes for state aid programs. Additionally, many outside scholarship programs need to see your FAFSA before they consider your eligibility for their money. If you’re applying for scholarships, you need to stay on top of those deadlines, too.
What happens if I miss the deadlines?
Don’t miss the deadlines. Plan to get your FAFSA in by the earliest of all the deadlines for your best crack at college money. By missing deadlines, you take yourself out of the running for money you might otherwise get. Some states and colleges continue awarding aid to FAFSA latecomers, but your chances get much slimmer, and the payout is often less if you do get aid. It’s better just not to miss the deadlines.
If you miss the end-of-June federal deadline, you’re no longer eligible to submit that year’s FAFSA. Did we mention not to miss the deadlines?
Across the board, the motto really is “the sooner the better.” So put off the procrastinating until tomorrow. Apply by the earliest deadline. Get your FAFSA done today!
Drew Goins is a senior journalism major at the University of North Carolina. He’s also an intern with the U.S. Department of Education’s Federal Student Aid office. Likes: politics, language, good puns. Dislikes: mainly kale.
Happy National School Counseling Week! Many thanks to all you school counselors out there for your hard work and dedication.
Click to visit the Financial Aid Toolkit
Many times through the years, I’ve heard how busy the typical school counselor is, with a heavy case load and no time to learn everything there is to know about financial aid. Instead, counselors have sent out a plea for a selection of short, specific items that answer the questions a student will have at various points in the financial aid lifecycle. You asked for it; we built it. It’s called the Financial Aid Toolkit.
What’s the Financial Aid Toolkit?
FinancialAidToolkit.ed.gov is a site that was designed specifically for you, the school counselor, to give you information and resources that will help you educate students and parents about federal student aid for college.
What does the Financial Aid Toolkit offer?
It offers a lot, so be sure to explore the site. Meanwhile, here are some highlights:
Searchable library of fact sheets, videos, infographics, booklets, PowerPoint presentations, archived webinars, and more
FAFSA updates, including a list of which documents will be available on what dates
Why shouldn’t a counselor recommend the Financial Aid Toolkit to students and parents?
The Financial Aid Toolkit speaks to YOU, the counselor. It does not have the type of information or level of detail that a student or parent needs. Please send students and parents to StudentAid.gov for federal student aid information. (For fact sheets, videos, and other student-focused items, send students and parents to StudentAid.gov/resources.)
What else should a counselor know about the Financial Aid Toolkit?
Because the site is designed for you, your feedback is crucial to its success. At the bottom of each page, there’s a “Leave Us Feedback” link that’ll send you to the site survey so you can let us know what you like or what you’d like to see added to the site.
Remember, the Financial Aid Toolkit site is for you. Use it in good health!
Cindy Forbes Cameron has worked at the U.S. Department of Education’s office of Federal Student Aid for a million years—or perhaps 17. (Hard to tell the difference sometimes.) Cindy focuses on website content management and document creation and editing. She loves serving the school counselor/college access mentor community via the Financial Aid Toolkit, listserv postings, and conference exhibiting and speaking.
TRUE! You might have heard that you can’t complete the 2016–17 Free Application for Federal Student Aid (FAFSA®) until you file your 2015 taxes. This is actually a myth! The FAFSA allows you to use estimated financial information if you select “Will file” on the question about whether you’ve completed your 2015 tax return.
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The subsequent questions will ask about “2015” financial information, but you’re allowed to use 2014 numbers in these fields for now so you can get your FAFSA submitted early. Don’t worry, you won’t get in trouble for using estimated financial information; just make sure you update your FAFSA after you and/or your parents file 2015 taxes. Below are answers to common questions about submitting a FAFSA before filing taxes.
Why is it important to fill out the FAFSA early?
Some states, schools, scholarships, and other aid programs have deadlines that occur before you’re able to file taxes. If you wait, you could miss out on that money unless you use estimates and submit the FAFSA early. Did you know that some aid is first come, first served? That means once the pool of funding runs out (awarded to the early birds), there won’t be any money left for late FAFSA filers. You can find state deadlines on the FAFSA website.
However, we do not have a listing of every school’s deadline since they’re all different. You have to check with each school about their FAFSA deadline. If there is a scholarship or grant you’re applying for, check their FAFSA deadline too. Submit your FAFSA by your earliest deadline to maximize your financial aid.
How do I fill out the FAFSA if I haven’t filed taxes?
If your income from 2015 was similar to your income from 2014, use your 2014 taxes to estimate your financial information. If your 2015 income was very different from your 2014 income, use the income estimator (available within the FAFSA) to estimate financial information rather than basing your estimates on your 2014 taxes. Just click on the blue Income Estimator button, and the calculator will expand.
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How do I update my FAFSA once I’ve filed taxes?
After you file taxes, click Make FAFSA Corrections after logging in to fafsa.gov. Navigate to the “Finances” section and change your tax filing status to “Already completed.” From here, the FAFSA has a tool that allows you to automatically import tax information from the IRS into your FAFSA. This is called the IRS Data Retrieval Tool (IRS DRT) and it will be available on Feb. 7, 2016. You may not be able to use the IRS DRT immediately after you file taxes. You have to wait a few weeks after you file taxes before your tax data can be imported into the FAFSA.
After importing your tax information into the FAFSA, sign and submit your FAFSA. Remember, if you don’t see the confirmation page at fafsa.gov, you haven’t submitted your FAFSA yet. Be sure to read all the instructions as you sign and submit the FAFSA, and look for that confirmation page before you close your browser. Got it? Okay! Go meet those deadlines!
Sandra Vuong is a Digital Engagement Strategist at Federal Student Aid.