With the price of a college education rapidly rising over the last decade, and in the current difficult economic times, students and families are relying on financial aid more heavily now than ever before. In 2010-11, for example, undergraduate students received an average of $12,455 per full-time equivalent student in financial aid, according to the College Board.

But how can you get a share of those funds? Time to get to know FAFSA — Free Application for Federal Student Aid — the gateway through which students and their families can access the millions of dollars in grants, federal loans and tax breaks for which they may be eligible.

FAFSA is exactly as the name suggests: a FREE process to apply for financial aid for undergraduate and graduate school. Administered by the U.S. Department of Education, FAFSA, like many government programs, can be user-friendly at times and confusing at others. Just ask FPA member David A. Emery, CFP®, CDFA, CCPS. “It takes time and isn’t always as straightforward as you think,” said Emery, who has plenty of first-hand experience with the FAFSA, having helped financial planning clients and his own children through the process. “You only get one chance at the financial aid process, so you really have to be sure to do it right.”

His best advice for navigating the FAFSA form to give yourself the best chance of getting the aid you seek:

  • Prepare in advance. First, get familiar with the FAFSA by combing through the fafsa.ed.gov website, so you know what to expect each step of the way. Then find out which documents you will need to submit as part of the application, such as tax returns (for parents and student), W-2 forms, comprehensive records of assets and debts, Social Security numbers, etc. and gather them in advance. Next learn all you can about specific financial aid programs and requirements at the schools to which you plan to apply. Search the Web and talk to the admissions department representatives at those schools to find out what aid may be available via both private and public sources.
  • Start promptly. Emery recommends beginning the application process as close to the Jan. 1 opening date as possible to accommodate potential snags in the process. Filing late leaves little room for error. Also, keep in mind that with some aid programs, access to funds is first-come, first-serve.  
  • Be attentive to detail. Don’t let the nuances of the FAFSA process trip you up. Be aware of key details, such as the limitation on the number of schools for which a person can apply for aid (10), which assets to report (certain retirement plan assets needn’t be reported, for example), and the requirement that parents and students each have a unique FAFSA login and PIN. Because the same PIN number is used from year to year, safe keeping of that number is important as it is a difficult process to obtain a new PIN.
  • Meet all deadlines and program requirements. Financial aid deadlines can vary by state and by institution. Be sure to keep those dates straight. And be sure to provide everything the application, and the institution, request.
  • Ask for help. You’re bound to have questions about the FAFSA process. Seek answers from a school counselor or the financial aid office at the institution to which you’re applying. You can also tap FAFSA’s online chatroom (look for the link to “Live help” on the organization’s website) or its telephone hotline at 1-800-4-FED-AID (1-800-433-3243). Or e-mail questions to FAFSA at [email protected].

Given how much money is at stake, and the detailed financial requirements of the application process, it often makes sense to consult a financial planner.


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