In this video, we'll discuss the first three steps for paying for college, completion of the FAFSA. Welcome! Let's get down to the business of how to fund a college education. The choices you make in the coming months and years are crucial, and could be just as important for your life after school as the major you choose and the career you attain. Yet, financing your education doesn't have to be overwhelming.
In fact, we're going to make it as simple as 1-2-3. In Step 1, we'll discuss the FAFSA and how it's the keystone to financing an education. In Step 2, we'll clarify your award letter. In Step 3, we'll explore all your funding sources and introduce smart borrowing.
Okay, funding your education starts with the free application for Federal Student Aid, better known as the FAFSA. Get the ball rolling by going to studentaid.gov. Completing the FAFSA online is the fastest and safest way to complete the FAFSA. However, you can download and complete a paper form as well.
The FAFSA is for everyone. regardless of your age, family, income, or academic background. Completing the FAFSA is the first step to paying for college, even if you or your family have saved for your post-secondary education. You may be eligible for scholarships, grants, work-study, or state aid that require completion of the FAFSA. Your answers to questions on the FAFSA determine whether you are considered a dependent or independent student.
If you're a dependent student, you must report your parents'income and asset information as well as your own. If you're not sure what your filing status is, go to studentaid.gov slash dependency. As of October 2016, the FAFSA allows for earlier completion and makes it easier to report income information. With this change, you can complete the FAFSA as early as October of fall semester for the next academic year. When you're ready to complete the FAFSA, make sure you have the same documents that are required to complete your tax forms nearby, like your social security number or similar identification, W-2 forms, bank statements, and other documents that show income.
Also, you'll need your FSA ID, the Department of Education, estimates that it will take you 55 minutes to complete the FAFSA the first time, so budget your time appropriately. Once you've submitted the FAFSA, you can take a deep breath. You've accomplished an important task in funding your education. Within days, you'll receive a student aid report. This lists the information you submitted that will be sent to the schools you selected.
If you notice something is incorrect on this report, you have a chance to make corrections at this time. If everything looks good, just keep this document in your records. Based on the asset and income information you provided, The Department of Education calculates an Expected Family Contribution, or EFC.
That EFC stays the same from school to school. No matter the cost of attendance at each school, your EFC will not change for that year. Remember, you must complete the FAFSA every year that you want funding.
Your EFC could change in subsequent years if income amounts change or if your siblings start or finish college. Using this EFC, your schools will send you an award letter. This award letter, which we'll cover in depth next, lists the financial aid package your schools will offer you. Phew! That's a lot of information you just received, and it was all started by the completion of the FAFSA.