Understand the FAFSA in 9 Minutes or Less

FAFSA stands for Free Application for Federal Student Aid, and it’s the form that many college- and career-bound students complete to be eligible for:

• Federal student aid, such as loans, grants and work-study programs.
• State student loans or grants. Many states use FAFSA data.
• Financial aid from the college you plan to attend. Many institutions also use FAFSA data.

If you’re planning for college, here are some FAFSA basics.

RUN TIME: 8:24

Get an overview of how to complete the FAFSA quickly and accurately. This video is part of the St. Louis Fed’s Personal Finance 101 Conversations. (Note: The Federal Student Aid Office has made a few updates since this was originally produced, but the foundation remains.)

Essential Information to Have Handy

Your earliest deadline to file

The FAFSA period for the 2019-20 academic year opened Oct. 1, 2018, and it will end June 30, 2020. But that’s the federal deadline; many state deadlines fall earlier than that. The Department of Education’s Federal Student Aid Office has a look-up list of state deadlines. Likewise, many college and university deadlines fall before the federal deadline, so check with your institution’s financial aid office. Complete your application before the earliest of the deadlines.

The student applicant’s relevant information

Also have parental information if the student is a dependent. This includes Social Security number and driver’s license; federal tax forms and returns; and bank statements and investment records, along with business information (if applicable).

Main Sections of the FAFSA

According to the Department of Education, the FAFSA takes most people about 30 minutes to complete online. Yes, there are a lot of questions and fields … but they fall into some familiar buckets.

Student information: Includes contact and personal info, along with questions about your current education and planned path.

School selection: Covers the institutions you’re applying to, along with your housing plans. The Federal Student Aid Office says you can list up to 10 schools if you’re applying online or in the new mobile app.

Dependency status: Asks questions to determine whether you are a dependent or independent student.

Parent information: Asks questions such as parents’ dates of birth, Social Security numbers, household size and more.

Financial information: Covers information found on tax forms, bank account statements, investment statements and the like.

Is Filling Out the FAFSA Worth It?

Completing the FAFSA is a required step to applying for aid. The Federal Student Aid Office reports that the Department of Education awards more than $120 billion a year in grants, loans and work-study funds to approximately 13 million students.

Meanwhile, according to the Bureau of Labor Statistics, the median weekly earnings in 2016 were $692 for someone with a high school diploma versus $1,156 for someone with a bachelor’s degree.

Additional Resources:

• Federal Student Aid Office’s full FAFSA guide
• Open Vault: The Most Important Investment You Make Is in Yourself
• Page One Economics: Get an Education, Even if It Means Borrowing
• Econ Lowdown: FAFSA 101