The Free Application for Federal Student Aid (FAFSA) introduced changes that may have a big impact on students’ financial aid packages. These changes, which will recalculate the way need is assessed, will be in full effect by the 2024-25 award year, according to Federal Student Aid. Due to these changes, the FAFSA application will not be open until December 2023, according to CNBC. The FAFSA typically opens on Oct. 1 every year.
One of the changes will be a transition from Expected Family Contribution (EFC) to the new Student Aid Index (SAI) when determining aid eligibility, according to the FSA.
EFC and SAI are calculated in almost the same way. In both, a student’s contributions to income and their assets are added together; if they are a dependent, their parents’ contributions are added as well.
In the previous EFC calculations, the parent contribution was divided by the number of children in college. Independent students divided their own contributions by the number of students dependent on them, if they also had children or siblings whose educations they were funding.
However, in the new SAI, the same calculation is done, but with no division for the number of dependents. This means that households with multiple dependents in college may have to pay what had been their net EFC, but for each individual student.
College Inside Track reports that the change in calculations could have a drastic effect, especially on middle income families with more than one child in college, since many lower income families already have a low EFC.
Though the FAFSA will no longer include the number of students that a family has in college, the University of Southern California says that it will still consider it when looking at financial aid.
“While there are policy changes that will be in effect with the new FAFSA, such as the number of family members in college no longer being considered, USC will continue to take this information into account when determining eligibility for USC-based aid,” said a representative from USC Financial Aid.
In their statement, USC also encouraged families to alert them to any special circumstances in order to make appropriate adjustments to students’ need-based aid.
Elenoa Taumohaapi, a sophomore majoring in human biology with a minor in stem cell research, said that she appreciated USC saying they will still consider the amount of family members in college when deciding aid, but still “felt terrible” since her two younger siblings will be in college soon.
“USC gave me a lot of money… but none of my siblings are applying to USC, and they’re gonna be out of state too,” she said. “My family does not have enough money to fund three full-time college students.”
FSA said that the SAI is also taking fewer items into account when determining a student or household’s income and assets in order to lessen the need to self-report income. Now, most of the necessary information is in the U.S. income tax return form, which can be used to auto-fill sections of the FAFSA.
Other changes include new expectations for exempting students from providing asset information, and the possibility for SAI to be a negative number.
The first phase of these changes started in the 2021-22 school year. In 2021, FSA removed the requirement for male students to register for Selective Service, which keeps track of citizens eligible to be drafted into the military, in order to receive federal aid. Questions about drug-related convictions have also been removed.
According to FSA, all of these changes are due to the FAFSA Simplification Act, which was included in the Consolidated Appropriations Act of 2021, which was amended in 2022.
The changes made for the 2024-25 year will be the last amendments required by the Consolidated Appropriations Act.
The full list of changes for 2024-25 can be viewed at FSA’s website.