As we've hinted in our previous posts, there are changes on the way to the FAFSA effective in the 2023-2024 school year.
The ultimate goal of the changes is simplification. While simplicity sounds appealing - it's complicated to determine whether the changes will benefit most families. The easiest statement to make at this point is there will be fewer questions. The FAFSA questions will be reduced from six pages down to two pages.
- Income Protection Allowance - parent income protection allowance will increase by 20% and student income protection will be 35% or higher. Which should increase aid eligibility.
- Number of Children in College - the FAFSA will no longer divide the parent contribution by the number of children in college. This change will negatively impact families with multiple children in school at the same time.
- Changes to Income - Untaxed income and money paid on the student's behalf will no longer be reported on the FAFSA. This includes pretax retirement contributions and financial support from grandparents. In other words, this creates a few more planning strategies families can utilize.
- Remember Expected Family Contribution? Beginning in 2023-2024 the corrected terminology will be Student Aid Index or SAI. The hope is to make the formula less complicated and more accurately identify what families will pay.
These changes and others go into affect and will be used on the FAFSA that opens October 1st of 2022. If you have questions on this topic and would like more information, please let us know.