After years of attempted reforms, FAFSA finally will be simplified

Home|Blog|After years of attempted reforms, FAFSA finally will be simplified

By Laurie Owens/VCCS Director of Financial Aid

Laurie Owens

Laurie Owens

Recently passed legislation known as the Consolidated Appropriations Act 2021 will finally move us forward in the simplification of the Free Application for Federal Student Aid (FAFSA).  It will take the FAFSA from 108 questions down to approximately three dozen.  This change will take effect with the 2023-2024 FAFSA so that both the U.S. Department of Education and colleges have ample time for implementation.

U.S. Sen. Lamar Alexander

Tenn. U.S. Sen. Lamar Alexander pushed for at least seven years to streamline what he called “the dreaded” FASFA form.

Some will recall Senator Lamar Alexander dramatically unfolding a paper FAFSA form to demonstrate its length.  However, much of the paper form included detailed instructions and most students now complete the FAFSA online.  Nonetheless, his point was still made.  The number of questions could definitely be reduced.  However, this was easier said than done and could not come at the expense of the integrity of the Title IV programs that are awarded based on its results.

One of the most talked about changes in this legislation is the elimination of the Expected Family Contribution; otherwise known as the EFC.  This term has always been extremely confusing and stressful for students and families.  They have always misinterpreted it to be the amount they would be expected to pay and they almost always disagreed with it.  The EFC is actually a measure of the family’s ability to pay.  It is not what they will actually pay.  They might pay more or less depending on the financial aid package that is awarded.

As a result of this legislation, the EFC will be replaced with the Student Aid Index or SAI.  Colleges will likely use the SAI in the same way they do the EFC to determine financial need.  Hopefully it will be less stressful and confusing for students and families though. What is interesting to note is that the SAI might be a negative number where the EFC could only go as low as zero.  This may create some confusion but will likely be better received or even overlooked simply because of its name.

There are a host of other changes that come with this new legislation.  Most of those will only make sense to Financial Aid staff so they will not be discussed here.  These involve a variety of definition changes, formula modifications, and eligibility criteria adjustments.

So, while these changes will not go into effect for a few years, they are still a step in the right direction.  Simplifying the FAFSA and using better terminology should go a long way with students and families.  The FAFSA will likely continue to be seen as a barrier and we may never be able to change that completely but it remains the single source of reliable data for colleges to assess financial need and award financial aid.  It is hoped that FAFSA completion rates will increase with the anticipated implementation of the G3 program, which will be a last dollar program that will require completion of the FAFSA so that other federal and state aid can be awarded first.

Almost 42 percent of our students complete the FAFSA annually. Hopefully between the new G3 program and the changes described above, this percentage will increase and we will have the opportunity to assist and enroll more students in need.

 

Nationally, community college students have low completion rates for FAFSA.  Read more about that here.

 

You can read more about upcoming changes in FAFSA here.

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