Changes in Circumstance and FAFSA

            In the fall of senior year, the family of college-bound seniors are asked to complete the FAFSA or Free Application for Federal Student Aid. The FAFSA opens for the following school year on October 1st and uses the prior year’s tax return as the information source in making determinations about financial need. So, a student who plans to graduate high school in 2023 and enter college in the Fall of 2023 should complete their FAFSA as soon as possible after October 1, 2022 and will use their tax return from 2021 to do that.

            A lot can happen in a given year though up to October when the FAFSA is completed. What happens if your life is disrupted in some way that will make your financial situation very different in the 23-24 school year than it was in 2021?

            The people who work in a college’s financial aid office aren’t cold and heartless. They understand the ebbs and flows of life and families, so the key is here is to communicate. There’s no limit to the number of things that could happen to a family. A family business could burn down, A parent could have to leave their job to take care of a terminally sick child, a parent could walk out on their family, a parent could pass away–as as example though, let’s just say the primary bread winner of a family lost their job and has been unable to find work. What used to be a family that did just fine, now struggles to make ends meet. 

            So here is what needs to happen: Go ahead and complete the FAFSA as soon as possible after October 1 with your prior year’s tax return. At this point, few students will already know which college they are actually going to, so you’ll send the FAFSA to all the schools you are applying to. If the student is applying to colleges in the fall (they should be) they should start receiving admission decisions in late fall, into winter and spring. The schools that accept the student will soon follow up with financial aid packages. This is the fruit that grows from the FAFSA seed and what your target is. As soon as the student has made their firm decision on the college they plan to attend, whether they have already received their financial aid package or not, it’s time to call the financial aid office at that school.

            “Hi, my child has been admitted and will be joining you in the fall. We completed the FAFSA, but I’m afraid our life has taken a turn that has significantly changed our finances. Can we talk about this?” A financial aid officer will hear your story. They will likely ask for some form of proof, so don’t be offended if they want to see some documents like divorce papers or death certificates. Ultimately, what they CAN do (they are not obligated to do anything, but again, they are humans) is issue what is called a Professional Judgement. Basically, they can manually adjust your FAFSA or financial aid package and increase the amount of aid offered to you. 

Students must re-do their FAFSA every year, so whatever your change in circumstance is, that should be reflected when you file your taxes again the following year and all will be well. Whatever the case, just remember that a little communication with actual people goes a long way.