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Most families do not know when to file for college financial aid on the FAFSA

The White House’s decision to forgive federal student loans may be fair days. However, current high school seniors will still struggle with how to pay for college without taking on too much debt.

With tuition on the rise, most families rely on a combination of resources to make it work. Income and savings cover more than half of college costs, free money from scholarships and grants accounts for about a quarter of the costs, and student loans account for most of the rest, according to Sallie Mae’s annual How America Pays for College report.

However, families are missing out on opportunities to make college more affordable, Sallie Mae spokesman Rick Castellano said.

That’s where the Free Application for Federal Student Aid comes in.

More from Personal Finance:
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Students must complete the FAFSA to access any aid. For the 2023-2024 school year, FAFSA filing season opens this fall on Saturday, October 1st, and the sooner students file, the better.

The earlier families fill out the FAFSA, the better their chances of receiving aid, Castellano said, since some financial aid is awarded on a first-come, first-served basis or through limited-fund programs.

However, 75% of families don’t know that the FAFSA opens on October 1, Sallie Mae also found.

“You want to get in line for the free money; most of it is first-come, first-served,” Castellano said. Otherwise, you’re “leaving free money on the table, and those dollars are what will help make college affordable.”

Only slightly more than half of all families know that all students are eligible to file the FAFSA, Castellano said. “It’s alarming.”

Scholarships can be the key to affording college

Scholarships are a key source of funding, but only 60% of families take advantage of them, according to the education lender.

About 6 in 10 of those who took advantage of the scholarships received them directly from their student’s school and received an average of $6,335.

Most of the families who didn’t take advantage of the scholarship said it was because they didn’t even apply.

“There are 6 million scholarships available for any number of interests and skills,” Castellano said. “They don’t all go to the top of the class or star athletes.”

Why More Families Are Not Filling Out the FAFSA

According to Sallie Mae, 70% of families completed the FAFSA last year, up slightly from 68% the year before, which was a record low.

“We would like that number to be higher,” Castellano said.

Among those who do not applySallie Mae found that the most common reason was that they thought their income was too high to qualify for benefits, then they thought the application was too difficult or they just didn’t know about it.

“Virtually everyone who applies for the FAFSA will qualify for some form of aid,” Castellano said.

Almost everyone who applies for the FAFSA will qualify for some form of aid.

Rick Castellano

spokeswoman Sallie May

Many factors, not only incomego into determining how much aid students receive, including the total number of people in the household and the number of children in college, as well as other financial obligations such as home loan or child support payments.

The application process itself is another hurdle, families say.

However, experts say you can complete the FAFSA form online at fafsa.gov or in the myStudentAid app in less than an hour, especially if you have documents, including last year’s W-2 and tax return. Sallie Mae also has a free online FAFSA tool to help families navigate the process.

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Most families do not know when to file for college financial aid on the FAFSA

The White House’s decision to forgive federal student loans may be fair days. However, current high school seniors will still struggle with how to pay for college without taking on too much debt.

With tuition on the rise, most families rely on a combination of resources to make it work. Income and savings cover more than half of college costs, free money from scholarships and grants accounts for about a quarter of the costs, and student loans account for most of the rest, according to Sallie Mae’s annual How America Pays for College report.

However, families are missing out on opportunities to make college more affordable, Sallie Mae spokesman Rick Castellano said.

That’s where the Free Application for Federal Student Aid comes in.

More from Personal Finance:
Enrollment in universities continues to decrease
Inflation makes college even more expensive
Would you qualify for student loan forgiveness?

Students must complete the FAFSA to access any aid. For the 2023-2024 school year, FAFSA filing season opens this fall on Saturday, October 1st, and the sooner students file, the better.

The earlier families fill out the FAFSA, the better their chances of receiving aid, Castellano said, since some financial aid is awarded on a first-come, first-served basis or through limited-fund programs.

However, 75% of families don’t know that the FAFSA opens on October 1, Sallie Mae also found.

“You want to get in line for the free money; most of it is first-come, first-served,” Castellano said. Otherwise, you’re “leaving free money on the table, and those dollars are what will help make college affordable.”

Only slightly more than half of all families know that all students are eligible to file the FAFSA, Castellano said. “It’s alarming.”

Scholarships can be the key to affording college

Scholarships are a key source of funding, but only 60% of families take advantage of them, according to the education lender.

About 6 in 10 of those who took advantage of the scholarships received them directly from their student’s school and received an average of $6,335.

Most of the families who didn’t take advantage of the scholarship said it was because they didn’t even apply.

“There are 6 million scholarships available for any number of interests and skills,” Castellano said. “They don’t all go to the top of the class or star athletes.”

Why More Families Are Not Filling Out the FAFSA

According to Sallie Mae, 70% of families completed the FAFSA last year, up slightly from 68% the year before, which was a record low.

“We would like that number to be higher,” Castellano said.

Among those who do not applySallie Mae found that the most common reason was that they thought their income was too high to qualify for benefits, then they thought the application was too difficult or they just didn’t know about it.

“Virtually everyone who applies for the FAFSA will qualify for some form of aid,” Castellano said.

Almost everyone who applies for the FAFSA will qualify for some form of aid.

Rick Castellano

spokeswoman Sallie May

Many factors, not only incomego into determining how much aid students receive, including the total number of people in the household and the number of children in college, as well as other financial obligations such as home loan or child support payments.

The application process itself is another hurdle, families say.

However, experts say you can complete the FAFSA form online at fafsa.gov or in the myStudentAid app in less than an hour, especially if you have documents, including last year’s W-2 and tax return. Sallie Mae also has a free online FAFSA tool to help families navigate the process.

Subscribe to CNBC on YouTube.

Reported by Source link

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