Money-Saving FAFSA Filing Tips

Strategies to Minimize Costs and Maximize Financial Aid

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Father and son looking at the FAFSA website on a laptop
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It can be a lot of work when it comes to completing the FAFSA, that all-important application which is used to calculate the amount of college financial aid your child can receive.

Key Takeaways

  • Fill out the FAFSA whether or not you think your child is eligible for financial aid.
  • Be sure you're accessing the official FAFSA website hosted by the Department of Education.
  • Your assets count in the determination of financial need, but one major one does not: your home.

The Consolidated Appropriations Act, passed in December 2020, includes a FAFSA simplification provision that will reduce the number of questions required beginning with the October 2022 FAFSA for the 2023-24 financial award year.

That doesn’t help families that are grappling with this year’s version. Here are some money-saving tips that could help minimize your college costs and maximize the amount of college financial aid your child receives.

FAFSA Filing Tips

Only Use the Official FAFSA Site

There are imposters out there that try to lure you in with promises of scholarships or guarantees of financial aid, so be sure you only use the official government site to complete the FAFSA, which is free. If a website asks for payment, you know it's fraudulent.

Fill It Out the FAFSA Even If You Don't Think You Qualify

Some families miss out on financial aid because they don’t even complete the FAFSA. They could have fallen victim to one of the FAFSA myths, believe they earn too much money, or they might think it’s too hard. Even if you don’t qualify for financial aid, you may still need to complete the FAFSA for certain types of federal student loans.

One Time It’s Good To Get Older

While most people don’t like to admit that they are getting older, this can actually be a good thing when it comes to college financial aid. The age of the oldest parent is taken into consideration when calculating the amount of the expected family contribution (EFC), so be sure to complete the FAFSA in detail. And accurately.


The EFC will be replaced by the Student Aid Index (SAI) as part of the FAFSA simplification, effective in the 2023-24 award year.

Having More Children in College Counts

It can be a drain financially for parents to have more than one child in college at the same time. The government understands and wants to motivate larger families to send all their children to college, so there is some break in the EFC. Even if you did not qualify for financial aid with only one child in college, it is worth applying again once a second child plans to attend.

Your House's Value Doesn’t Matter

You might be surprised to learn that the equity you have in your home is not taken into consideration for need-based aid. While the EFC calculation does consider the value of real estate investments, the home in which you reside is not included.

Keep Up the Retirement Accounts

Some parents might be tempted to withdraw money from their retirement accounts to pay for their children’s education. This might not be the wisest financial move, and retirement accounts are not included in EFC calculations. Speak with a professional financial advisor to determine whether withdrawals or borrowing will be most appropriate for your individual situation.

Be Careful About How Much Money Is in Your Child’s Name

You might think that it would be a good idea to transfer some funds to your child so that your financial position will look weaker, but this strategy could backfire. The assessment on a child’s assets comes in at 20%, while it is calculated at just 5.64% on the parents’ assets.

It Might Help To Pay Some Bills

If you have a larger amount of money in your checking or savings account, it could be helpful to pay off some of your bills or to pay down your mortgage. The FAFSA does not ask about money you owe, but it does inquire about your liquid assets. If those balances are lower, it could qualify your child for additional aid.

Above all, don’t be afraid to look for help. The Federal Student Aid website has many excellent resources, and you can also consult a professional college financial aid advisor. Making the right choices now could affect your family’s finances for many years to come.

Frequently Asked Questions (FAQs)

At what income should you not fill out FAFSA?

There are no income caps for financial aid, so it's in your (and your child's) best interests to fill out the FAFSA form. Since "financial need" is the cost of attendance less your expected family contribution, financial aid awards are unique in every situation.

Do parents assets affect financial aid?

Both parent and student assets affect financial aid awards. Although parents likely have more assets than their children do, a child's assets have a great impact on the determination of financial need.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Congressional Research Service. "FAFSA Simplification Act."

  2. Federal Student Aid Office of the U.S. Department of Education." Wondering How the Amount of Your Federal Student Aid Is Determined?"

  3. Federal Financial Aid. "How To Complete the FAFSA Form When You Have Multiple Children."

  4. Federal Financial Aid. "What Is the Net Worth of Your Parents’ Investments?"

  5. FINRA. "Saving For College: UGMA and UTMA Custodial Accounts."

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