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FAFSA – 10 Common Mistakes to Avoid

Tis the season for the annual college financing rite of passage, October 1, 2019 means it is time to complete the FAFSA for the 2020-2021 academic year. 

Below are Ten Common Mistakes to avoid.

  1. Don’t Fear the FAFSA. Many families will not bother to complete the Free Application for Federal Student Aid (aka, the FAFSA) because they do not believe they will qualify. What many fail to understand is many colleges and universities will not consider you for institutional awards if you have not completed the FAFSA. Don’t leave free money on the table.

  2. Do not include the value of your primary residence (your home) as an asset. As a protected asset it does not need to be reported. Doing so will increase your Expected Family Contribution (EFC).

  3. Do not include the value of your retirement accounts as an asset – See #2.

  4. The words “you” and “your” always refer to the student. Even though 90% of the time Mom or Dad actually complete and submit the application, technically the student is submitting the FAFSA,

  5. Use legal names – matched to what is on the student’s Social Security Card – i.e., don’t use Jeff instead of Jeffrey.

  6. Make sure you are completing for the correct academic year. Both the current (2019) and next (2020) academic years will be active on Oct. 1st. You are starting a new FAFSA for the 2020-2021 academic year.

  7. If legally divorced – only the custodial parent’s information needs to be reported. If remarried, the step-parents information needs to be included.

  8. Entering the wrong federal income tax paid amount: This amount is on your income tax return forms, not your W‐2 form(s).

  9. Leaving a data field blank, instead of entering a zero (“0”). Too many blanks may cause miscalculations and an application rejection. Enter a ‘0’ or ‘not applicable’ instead of leaving a blank.

  10. Report the value of 529 plans as a Parent Asset, not as a student asset, even if the 529 plans are in the student’s name. For a student who must report parental information (dependent student), the accounts are reported as parental investments in question 89 (Parent Assets), including all accounts owned by the student and all accounts owned by the parents for any member of the household.” Incorrectly counting a 529 plan as a student asset will likely increase your Expected Family Contribution (EFC). Rather than being counted in the parent assessment at an approximate rate of 5.64%, it is assessed at a student rate of 20-25% in the EFC calculation.

College is expensive enough. Don’t Fear the FAFSA. Failing to complete it might cost you thousands of dollars. 

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Looking for additional FAFSA tips or need help finding good match colleges? Contact me. I will work with you to shave thousand’s of $$ off a college degree. 

Jeff has spent 30+ years working in higher education as a Registrar and Director of Student/Academic Services. As an educational college planning consultant, he uses his experience and insights to save you $$$ by helping you in identify “good match” colleges to fit your academic, social and financial needs.

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