Next Year’s FAFSA Overhaul: Six Things To Know Now

Will you be a senior in high school next school year? Are you a parent with a child in college or headed to college? You will be among the first to complete the federal government’s new simplified version of the Free Application for Federal Student Aid, better known as the FAFSA.

Filling out the FAFSA is required to get any kind of federal financial aid, including Pell Grants and the government’s lower-cost loans. Most states and colleges also use the FAFSA as a starting point to apply for grants and scholarships. Private scholarship providers often want to see this information as well.

The U.S. Department of Education notes that this will be a dramatic overhaul — the biggest change in financial aid in 40 years.

In many ways, filling out the FAFSA will be much easier than it has been in the past. But there are controversial aspects to the new form as well. If you’re counting on financial aid to attend college in September 2024, it’s important to tune in now so you’re prepared to complete the new FAFSA once it opens.

 

Six Things To Know About the New FAFSA

1. The new FAFSA will be quicker to fill out

As promised under the FAFSA Simplification Act, the revamped form will have no more than 36 questions, down from 108. A well-organized family could easily get the FAFSA done in less than an hour on a weekend morning.

2. More low-income students and families will get access to federal Pell Grants

Revised financial aid formulas will likely increase the number of low-income students who are eligible for the federal government’s Pell Grants, according to a recent analysis by the Brookings Institution. While the lowest-income families have always received maximum Pell Grant funding, families with a bit more income may receive more aid than they have in the past. Students who are eligible to receive the maximum award could get more than $7,300 to help cover school expenses.

3. But be aware: The FAFSA will be opening late

The FAFSA usually opens on Oct. 1. This coming year, the application won’t be available until sometime in December. This could be an issue for the growing number of families that are applying to colleges seeking an early decision or early action. Colleges that offer these options may be accepting students — and offering financial aid packages — before the FAFSA even opens. Other important programs, like state grant funding and educational opportunity programs (EOPs) will face delays in processing applications. It is crucial to be in touch with the colleges you are applying to. They will have instructions on how to submit the financial information they will need in the fall. Many colleges will use the CSS Profile, while others may have forms of their own. And you will still need to fill out the FAFSA after it opens in December. Thankfully, the FAFSA will return to an Oct. 1 opening date in following years.

4. There will be less federal aid for families with siblings in college

The new financial aid formulas have stripped out extra help for families that have more than one kid in college at the same time. If you have more than one student in college right now, you may see a reduction in federal aid (depending on whether you were getting it to begin with). Colleges may try to make up the difference with scholarships from their own funds, but this will vary by school.

5. You will be required to share your IRS tax data to complete the FAFSA

The FAFSA has always asked families to provide information from their tax forms. But the new FAFSA rules require that you give the IRS permission to share your family’s tax information directly with the U.S. Department of Education, which oversees the FAFSA. The good news is that you won’t have to hunt through your taxes to fill out the FAFSA. The less good news is that you will need to trust that the IRS shares your tax information correctly. There will be no way to double-check if the tax data shared is accurate. If there is any concern about errors, you will need to work with the colleges you are applying in order to make sure the data transmitted was correct.

6. The FAFSA’s FSA ID will be more important than ever

It’s important to understand that the FAFSA is now entirely online and using strong security protocols to protect your family’s information and IRS data. To start the FAFSA, the student and at least one parent will need to have an FSA ID. This is your login information and will help link your family up to other government agencies, like the Social Security Administration and the IRS, which are part of the process. It’s recommended that you go online and get your FSA ID at least a week or two before you start your FAFSA. Then you can be assured that everything is set up.

 

Our Recommendation?

Get your FSA ID today! And be sure to save your login information in a safe place. Already have an FSA ID? Login and make sure that your email and password are working. This is the one thing we can all do now to prepare for the FAFSA of the future! 🙂