Financial Aid Forms
Copyright 2025 Financial Aid Consulting. All rights reserved. No portion of this article may be reproduced mechanically, electronically, by photocopying, or by any other means without the author's permission. Howard can be reached at finaidguy@gmail.com
With college costs continuing to escalate, financial aid is as necessary to pay for college as a mortgage is to pay for a home. Families from all economic classes are realizing that financial aid is not charity but a necessary resource to fund a college education.
The Basics
Financial aid is based on merit or financial need as calculated by a FAFSA (Free Application for Federal Student Aid) and merit aid offered via the admissions office. The FAFSA is a U.S. Department of Education form available at www.fafsa.ed.gov starting October 1 for the next academic year. For example, the 2027-2028 FAFSA would be available October 1, 2026,
The FAFSA calculates a student’s Student Aid Index (SAI), the amount a family “should” be able to contribute to the cost of a college education. It is then deducted from the college costs of attendance to determine financial need. Good, but not perfect, an estimate of their ability to pay.
The Numbers
For example, if the cost of attending college is $60,000, the financial need would be determined by deducting a family’s SAI of $15,000, resulting in a need for financial aid of $45,000. Colleges can fully or partially fill that need with loans, grants, scholarships, and work-study programs. Students must use each college’s net price calculator to estimate their out-of-pocket cost. The earlier a FAFSA is submitted, the better the chances of receiving more financial aid.
FAFSA
The FAFSA recognizes ordinary living expenses and taxes by providing an income protection allowance based on family income and size, the number of working parents, the number of children in college, and the federal income taxes paid. The net result is then multiplied by a sliding scale of 22% to 47% of income to determine the parental portion of the SAI calculation.
Students receive an income protection allowance of up to $11,150 without impacting their SAI. Amounts over that limit are multiplied by 50% to determine whether the student’s contribution to the SAI results.
Allowances are also applied to certain parental assets, which are only multiplied by 5.6% after an asset protection allowance and at 20% for a student without any allowance.
Parental marital status is also critical for determining whether one or both parents report their household income, even if they live together in a marital union.
CSS/Financial Aid Profile
Some private colleges use an additional form called the CSS/Financial Aid Profile, https://cssprofile.collegeboard.org, which becomes available each October 1 from the College Board. This form is used for institutional financial aid. The college controls it, employing a formula to calculate needs based on more detailed questions. Unlike the FAFSA, it requests information about consumer debt, home ownership, medical expenses, prior and future income, and educational costs. This detailed form requires similar data that the non-custodial parent completes separately.
Parents may think they do not qualify for financial aid, but they should still fill out a FAFSA if educational financing is needed. Regardless of parents’ income, students are eligible for at least $5,500 in unsubsidized Stafford Loans in their first year, with annual increases up to $7,500 in their junior and senior years. Students can also use Stafford Loans to assume some financial responsibility for their education while building a positive credit history when repayment occurs.
Points to Ponder
Federal income tax information is downloaded from the IRS on the FAFSA for single taxpayers or those filing jointly. The CSS requires this information to be entered manually.
Students can be considered independent if questions on the FAFSA qualify them. Independent students can exclude parental income.
The custodial parent is the one who provides the most financial support to the student.
Family size is calculated based on the dependency from the federal tax return.
Child support is now reported as an asset, not income.
Seek a financial consultant if you have exceptional circumstances
Any financial award can be appealed.
Please look at the following website to determine if a CSS profile and non-custodial information are required.https://cssprofile.collegeboard.org
Be honest, each college has red flags that determine if there is conflicting information.
Seek a financial consultant if you have exceptional circumstances.
FAFSA is based on the last tax return filed, while the FAFSA is based on reportable assets when the FAFSA is prepared.
Income significantly affects the SAI more than assets do.