Big FAFSA changes begin in October 2022
Big changes are coming to the FAFSA starting in October 2022. The “Free Application for Federal Student Aid” is a form that students and families must fill out in order to qualify for financial aid in college—and completing it has long been synonymous with “epic ordeal.”
That odious reputation is one reason Congress inserted FAFSA changes into its appropriations bill that became law in December 2020. The form is decreasing in size from about 108 questions to only three dozen. Instead of self-reporting income, that information will be imported directly to the FAFSA from their families’ returns. Leaders hope that more families will fill out this new, simpler version, and in doing so discover they are eligible for aid.
The downside accompanying the changes? The revised financial aid formula may reduce aid for some families, particularly middle- and upper-income families with more than one child in college at the same time. The FAFSA will still ask how many children in the family are in college, but the number won’t be factored into the financial aid formula, and parents won’t receive a break for having multiple students enrolled in college concurrently.
In a future of uncertainties, Florida 529 Prepaid Plans are guaranteed.
The appropriations measure also broadened the eligibility for Pell Grants, a type of financial aid that does not need to be repaid and is accessible to undergraduate students with the most need. In general, Pell Grant eligibility will be easier to determine, sooner. In year 2018-19, the percent of undergraduate students receiving a Pell grant was just 34%.
So how should these changes affect your college financial planning? If you will have two kids in college concurrently, you can evaluate your plan and whether it makes sense to start boosting your savings.
Also, you can lock in the cost of college tuition and fees with a Florida 529 Prepaid Plan – giving you peace of mind that you will be financially prepared for college, even if laws continue to change or the cost of college rises more than you expected.