7 On Your Side: 7 tips to maximize your FAFSA money
Each year, the U.S. government offers more than $120 billion in federal grants, loans, and work-study funds to help students pay for college, but sadly a big chunk goes unused, because applying for that money is a confusing and cumbersome process.
Families fear filling out FAFSA, the 180-page Free Application for Federal Student Aid form-which unlocks federal grants and determines eligibility for scholarships and student loans, the application process opens next week on October 2, 2019 and closes June 30th, 2020. If you don't file in this time frame, you miss out completely on aid for the 2020-21 school year
"There's about 40 billion in aid left unused each year for low to middle income families and that's primarily because the FAFSA is so difficult to file only 61percent of students get through this whole process," said Charlie Javice.
The at her website, Frank, www.withfrank.org helps students navigate the financial road to college, offering free help for FAFSA, which she warns will be harder this year because of the new income tax forms.
Taxes: Get Forms Ready
"There is no more 1040EZ for 1040A , there is only one 1040 now and the DOE did not prepare people for that so what used to be called a data-retrieval tool where you pull directly .from tax returns is no longer available " says Charlie.
This means if you go at it on your own, get ready to do some dreaded tax math.
CUSTODY & DIVORCED PARENT INCOME: LESS MEANS MORE
If your parents are divorced, Charlie says whoever has custody is whose tax form you include. If that parent claims the most financial responsibility or if parents share custody 50/50: the parent with less income will make you eligible for more aid.
"The most advantageous to show is the parent with the least amount of income, that being said you don't want to violate any rules the DOE set up, says Charlie.
It will help to pull tax forms together now and apply early.
PROCRASTINATE AND LOSE MONEY:
Procrastinate and lose out on financial aid: Twice as many applications are filed in October when FAFSA opens than any other month of the year. Schools and scholarship which offer needs based help can run out of money.
Brookdale Community College student Amir Noble said his FAFSA was held up because the signature page his mom needed to sign wouldn't load, a common complaint Charlies team encounters with clients..
HOUSEHOLD SIZE, COUNT YOURSELF
She also say families make mistakes on the simple question of househould size don't forget to COUNT YOURSELF in the number. If you don't, it basically means you're getting financial aid for one less than you should be getting and that's a big problem.
ELIGIBILITY: $250K OR LESS SHOULD FILE FAFSA
Some students don't think they're eligible because their parents earn a comfortable living but Charlie says household earning $250K or less annually should apply and they will be considered for aid.
BANK ACCOUNT: SMALLER THE BETTER
When you file for FAFSA the form asks what is in your personal bank account right now, at the time you fill out the form . Charlie Javice offers this inside tip: wait until the night before you get your paycheck so you have the least amount in your account to report." Less is more.
THE BIG TAKEAWAY
Documentation is very important. Since aid depends on information submitted the year before, if anything happened like a death, illness, divorce, which changes you financial situation you need to reflect that
Read and answer carefully: Errors will be flagged by schools and you'll get sent to the back of the line.
Deadlines: Federal, state and school deadlines vary set reminders for yourself.
BEWARE OF STUDENT LOAN SCAMS
First, watch out for the Student Loan Debt Elimination scam. Here - you'll get a call or an official looking letter offering government programs to help eliminate student debt. Note - nobody can promise loan forgiveness.
Next there's an Advanced Fee Scam Here scammers will promise to lower your monthly student loan payments if you first pay a fee.
It's illegal to charge upfront fees for this type of help.
Lastly Loan Consolidation Scams claiming to lump all your loans together and lower your interest rate if you pay them. Note - loan consolidation is something students can do on their own - for free.
THREE BIG DON'T DOS
Scammers promise fast loan forgiveness and they can easily fake official looking government seals.
1) Don't fall for official looking letters or websites
2) Don't share any personal information with any companies offering to help you cut your student debt.
3) Don't ever pay an upfront fee for student loan services. It's illegal and a telltale sign of a rip off.
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