Major Financial Aid Changes Coming: What Families Need to Know

The 2023-2024 FAFSA will open in December instead of October 1st, delaying financial aid packaging. Major changes are also coming, like basing aid on tax data and eliminating the multiple student college discount. While intending to direct more federal aid to lower-income families, impacts vary - some will benefit while others may see less aid. With the timeline pushed back, families will need to wait longer and plan carefully to optimize eligibility.





The 2023-2024 FAFSA form is bringing some of the biggest changes to financial aid in decades. As a parent, it's important to understand how these changes may impact your family's eligibility for financial aid. Here's what you need to know:


- Delayed FAFSA Submission: The FAFSA will now open in December instead of October 1st. This means you'll need to wait longer to submit the form and may not have a financial aid package from colleges until later.


- No More Expected Family Contribution (EFC): The EFC will be replaced with the Student Aid Index (SAI). This new number is intended to be more reflective of a family's financial strength. A lower SAI means more aid eligibility.


- Tax Info Directly from the IRS: Instead of manually entering tax data, you can directly import it from the IRS to the FAFSA. This should reduce errors but means you can't change the data.


- Untaxed Income Not Included: Things like pre-tax retirement contributions will no longer be added back to your income. This will lower the SAI for some families.


- Asset Protection Allowances Changed: How much of your assets are protected from assessment has been adjusted. For a family of four, just $2700 is now protected. 


- Business and Farm Assets Now Counted: Business and farm assets will now be included in the FAFSA, which could reduce aid eligibility.


- Elimination of Multiple College Sibling Discount: If you have two or more kids in college at the same time, your SAI will no longer be divided between them. Aid packages may be reduced.


- Possible Changes for Divorced Parents: Aid eligibility will now be based on the parent who provides more financial support, not who the child lives with most. Proof of support may be required.


The goal of these changes is to direct more need-based federal aid to lower-income families. However, the impact varies widely based on your individual situation. Be sure to consult with your financial aid office and stay tuned for more updates as the 2023-2024 FAFSA launch approaches. Planning ahead is critical to maximize financial aid in light of these changes.

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