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Federal financial aid for college is often underutilized due to the complexity of required paperwork; however, 90% of students who do complete the Free Application for Federal Student Aid (FAFSA) enroll in school. This year, the FAFSA is being streamlined in the hope of increasing participation. Hari Sreenivasan speaks with Kim Cook, executive director of the National College Access Network.
For high school seniors around the country and their families, it's the season to think about college applications and costs. A key to all of it, of course, is, what kind of financial aid can they receive? It's even more crucial for low- and middle-income students who may be leaving thousands of potential dollars on the table each year.
Starting this weekend, there are important changes for a student filling out the Free Application for Federal Student Aid, also known as FAFSA.
For one thing, they will be able to fill it out months earlier, in the hopes of getting information as they try to choose a school.
Let's fill in the picture.
Kim Cook is the executive director of the National College Access Network, which works closely on these issues.
So, first, what's the significance of what's happening this weekend?
KIM COOK, Executive Director, National College Access Network:
Right now, over 1.4 million students left $2.7 billion in financial aid on the table by not completing the Free Application for Federal Student Aid. So, these changes that will make the form earlier and easier for students are significant in helping many of those low-income students access the money they need to attend college.
And one of the significant complaints was how complex it was, how much information they needed. Now apparently there is a connection between your previous tax filing that you can sort of autopopulate online.
There is, so that's called the Internal Revenue Service data retrieval tool in lingo.
What's significant about these changes that are coming online tomorrow are that more students can more easily transfer that tax information because it's currently available tax data. In the past, we asked students to transfer the date that really wasn't available until tax filing deadlines.
But now we're going back another year to make it more available and easier for students to populate the forms with that income information that is sometimes hard to find.
Now, there is also that gap between when you found out if a school wanted you or not and then another couple of weeks or months to figure out what kind of financial aid you were going to get from them.
So, because of the filing times that used to be in January, financial aid offices were under the gun to get award applications out to students, so that they could make informed decisions about what kind of aid was available at each particular school, and where they could afford and make that college choice.
More importantly, on the front end, there was a crunch that we asked students to think about which colleges they would apply or go to before they had any sense of their aid eligibility, never mind what they will have now, which is a commitment of federal student aid on the front end, as early as October now, as they go into their college search and application time.
So, this was part of the general disincentive over kind of the burdens of trying to get in, I don't know how much money I'm going to get, I don't who is going to accept me, and kind of one competing with the other.
So, now we're giving students an early commitment of at least their federal aid, so a low-income student who receives a Pell Grant and subsidized loans could have up to $11,500 of a commitment as they look around and, A, make the important decision that college is affordable and something for me, and, B, where to go, that I have a commitment of money in my pocket to make this possible.
So, what happens if the colleges just decide to move all of their deadlines up? There's been some concern, especially for low- and middle-income households, that a deadline creep actually adds a lot of pressure and decreases the amount of completed applications.
We're watching carefully in this first year, because that is a concern, that students could have a real crunch to push what used to be a longer process and truncate that process of admissions and financial aid into the same three months.
The good news is, regardless of how that does play out this year, the May 1 commitment date holds steady. So, students could have that information earlier, but they can't be pressured to commit to an aid package before May 1.
Now, you said in the beginning, but it's kind of staggering to think about $2 billion left on the table.
How many students start this process and don't finish?
We're still trying to get some of that data.
Right now, we know how many students don't complete. So, 45 — only 45 percent of high school seniors complete a FAFSA by their high school graduation. Some continue to complete it after high school graduation as well. But that's still a staggering number, when you consider that the FAFSA is the ultimate predictor of whether a student will go on to enroll in college, with 90 percent of those completing a FAFSA enrolling in college.
And it's also interesting that there are multiple things. It's not just family income that figures out what kind of aid you get.
So, income obviously plays a significant role, but the number in college, whether your family qualifies for other federal means-tested benefits, where you go to college, so, many, many factors factor in. The key message that we want to get across and is part of a national FAFSA completion campaign that NCAN is kicking off called Form Your Future, is that this is your first step to going to college.
All students should complete the FAFSA and get the money for which they're eligible.
And even whether the type of household that you're in, what kind of siblings, if you have other siblings in school, are all factors.
Exactly. Exactly. Number in household, number in college, all of those factors come into play.
So, we don't want any students to rule themselves out. We want all students to complete that FAFSA to get that money that has been left on the table.
All right, Kim Cook, thanks so much.
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