The U.S. Department of Education is expected to release the Free Application for Federal Student Aid, or FAFSA, by December. 31. Here are the biggest changes to financial aid applications
The Free Application for Federal Student Aid—or FAFSA—can be a dreaded process for college-bound students and their parents across the U.S. The FAFSA application has typically been known to be lengthy, confusing, and detailed—resulting in billions of dollars of unclaimed aid.
However, the federal government is addressing those concerns by revamping FAFSA. The changes are a result of the FAFSA Simplification Act (also known as "Better FAFSA"), which passed in December 2020 as part of the pandemic relief package. The new FAFSA application is expected to launch on December 31, marking the most significant changes to how students apply for financial aid in decades.
“It is going to be substantially different, and that is good news,” said Michael Lemus, the outreach and marketing manager at the California Student Aid Commission. “Although, of course, people are like, ‘Oh my gosh, what’s going to happen?’”
“The FAFSA and financial aid process can be very overwhelming, very complex,” Lemus said — something he says applicants have vocalized to officials for many years. “And the good news is that, yes: Those changes are really meant to streamline the application.”
Here’s a breakdown of the major changes happening with the 2024-25 form.
The timeline will be shortened.
A big change is that the FAFSA is usually open from October 1 to March 2. But this year’s release was postponed to incorporate all the changes for "Better FAFSA," with a soft launch expected to open on December 31.
Colleges will have to review applications and create financial aid offers in a shorter period, and after receiving those packages, many families will have to make decisions about where to attend on a condensed timeline.
The takeaway? Everyone has three fewer months to complete the FAFSA application.
Additionally, once you submit your FAFSA, you won’t be able to edit the form until February. For example, if you submit the form the day it opens, and decide a week later you want to add another college to your application, you won’t be able to send your financial information to the new college right away.
The bottom line: If you’re considering applying to any other schools, add them to your FAFSA application when you fill it out so you’re not waiting weeks to edit your form. Nothing happens if you submit a FAFSA application to the school but don’t end up applying there.
The application will be simpler, with direct transfer from the IRS.
One of the most significant changes to the FAFSA application is that number of questions on the form has been cut by over half.
Fewer and simpler form questions is largely in part to data sharing with the IRS. Before directly transferring tax information from the IRS was clunky, unreliable, and difficult. Now, it actually will be a requirement for filling out the form online.
Once your income information is inputted, you’ll only see relevant questions. Students with lower household incomes and uncomplicated tax filing situations could see as few at 18 questions.
More students will qualify for Pell Grants.
The formula for awarding Pell Grants has been revamped: An additional 600,000 students will be newly eligible for a grant, while about 1.5 million students who are already eligible for a Pell Grant will now qualify for the maximum award.
The shorter, redesigned form is getting a lot of the spotlight, but Cook says the expanded grant eligibility is the “sleeper headline that I want students to know about.”
The term Expected Family Contribution is replaced with Student Aid Index.
There is a new metric to determine how much a student can qualify for aid, said Shelveen Ratnam, a spokesperson for the California Student Aid Commission.
The Student Aid Index (SAI) will replace the term Expected Family Contribution (EFC), which was considered misleading to many families. Instead, the FAFSA form will refer to SAI, which is a measure of financial strength that colleges can then use to award their financial aid dollars. The new figure will still be presented as a dollar amount.
“The SAI will help inform how much federal aid, and in some instances other institutional aid, for which a student might qualify, "says Ratnam.
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