Millions of parents and students fill out the Free Application for Federal Student Aid every year, but making one mistake can cost families thousands of dollars. Filing as close to the October 1 annual debut as possible is vital for families to get maximum financial aid for the 2018-2019 academic year.
We spoke to Rick Castellano, VP of Corporate Communications at Sallie Mae, to help your family get the most financial aid and to avoid these seven common mistakes:
Not filling it out
Families often think they make too much money to qualify for federal student aid, but many schools give money to middle class families. "If you don't fill out the FAFSA, you're telling your school you don't want their financial help," says Castellano. FAFSA is the first step in applying for most scholarships and university grants, which can have much higher income limits than Pell Grants. A family of four making $200,000 could qualify for university grants at some private universities.
Being afraid of the IRS Data Retrieval Tool
Because of the Equifax data breach, families are scared to use electronic tools with financial information. But the IRS Data Retrieval Tool that will import 2016 tax data into the form is easy to use and is highly secure. Don't waste time filling out tax information yourself.
Waiting too long to file
Financial aid such as university and state grants can be awarded on a first-come, first serve basis. And with the relatively new October 1 debut date for the 2018-2019 academic year, schools have the option to award financial aid packages months earlier than in past years. Thus, it's extra important to pay attention to state deadlines, and extra applications that may be required by the school. To find state deadlines go to the website for your state's department of education. For school financial aid information, contact the universities to which you're applying. You also may find state financial aid information on the final screen after completing your FAFSA form online. Filing just a month or two after October 1 could cost families thousands at some schools.
Not naming enough schools
You can choose up to 10 schools to receive your financial aid information. Pick 10. Why is this important? If a school is not on your list and you do end up choosing that school, you will get financial aid behind other students who named their school on the FAFSA form when first filing. If you don't have 10 schools you're considering among your final choices, add schools from your maybe list or a school that's a bit of a reach academically or financially. You may find they offer you a great financial aid package that makes the college worth a second look.
Not listing state schools first
Some state schools will give more aid to the students who listed their college at the top of the list. If there is no state school that you want to include on your list, include a state school from a neighboring state. Sometimes these schools may also give you more financial aid for listing their college near the top of the list.
Not being prepared
When you sit down to fill out the FAFSA form, you may experience delays if you don't have all your information ready. Parents and students should create a user id and password for the student and each parent beforehand. Parents should also gather financial records from brokerage accounts, bank accounts, 529 plan accounts, and real estate.
Paying to file the FAFSA
"The first F in FAFSA stands for free," says Castellano. Know free sources of help, which include your high school counselor, local college financial aid offices and the federal government Federal Student Aid site and phone number: (800) 433-3243.
Editorial Disclaimer: Opinions expressed here are author's alone, not those of any bank, credit card issuer or other company, and have not been reviewed, approved or otherwise endorsed by any of these entities. All information, including rates and fees, are accurate as of the date of publication.
This article was originally published on October 2, 2017, and has been updated.