Post date: Jan 3, 2016 11:30:48 PM
January is FAFSA time.
This year's form went live on the 1st, as it does, and everyone with students planning to attend college (who prefer not to foot the entire cost themselves) needs to complete it.
There are a number of articles circulating about how to "maximize your aid". Normally, I do not encourage their circulation because they often focus on shifting money around to hide it from the reportable accounts. Some may be OK with that philosophy. I am not. I believe that if you have been fortunate enough to be able to save for college, whatever the amount, you should put it toward that use.
There are some hints concerning FAFSA completion that I do think are worth circulating.
January often feels like a looooong time between paychecks. Holiday bills come in. Tuition checks go out. Year-end financial statements show what your investments have produced - or not. In other words, it is the perfect month to complete the FAFSA.
They ask for money available to pay for college. In your accounts. On the day you are completing the form. Not an average amount, what you have right now. Pay tuition. Pay down holiday bills. Have the dog's teeth cleaned. Then, before that January check hits, complete the form.
They ask students about their funds. Have them buy their books, pay down debts, put gas in the car. Then complete the FAFSA.
If your 529 fund lost money, report what is there - before another deposit is made. If you had to use most of it to pay this year's tuition, report what is left. If the graduation money is all used up from first year (or first semester) report what is left. Before putting anything else in. Monies in the student's name are all expected to be used for funding college. Monies in parents' names are less so. If your student has less available, report that.
The amount parents are expected to pay diminishes slightly each year that they get closer to retirement. If you have another student getting close to college, that adjusts the formula as well. You may have reduced your EFC by just getting a year older.
The bottom line is to fill out the FAFSA and soon. Be honest - they do link to your tax returns and dishonesty can cause you and your student problems, but be smart as well. If you have complicated returns, ask for help. The form itself tries to be helpful. They have little help boxes that tell you which lines on the tax form to use for most steps.
Best Wishes!