Kids and Money: Not enough parents realize importance of FAFSA | Jobs & Employment

If your plan for paying for college revolves around presidential campaign promises of free tuition, you’d better have a Plan B.

For many families, that entails filling out the FAFSA, the Free Application for Federal Student Aid.

The form, which is required for federal student loans, state grants, college programs, work-study and other money, is available online at https://studentaid.ed.gov., through a new app version, and by printing out a form and mailing it in. (Some highly selective schools also require supplemental financial aid forms.)

But only 77% of families in a 2019 survey submitted a FAFSA form, according to the “How America Pays for College” snapshot from higher education lender Sallie Mae and its Ipsos research partner.

Of those who don’t file the FAFSA, 39% didn’t think they’d qualify, 29% didn’t file because they didn’t know about it or missed the deadline, and 27% were missing information, didn’t have time or felt the process was too complicated, according to Sallie Mae.

“Congress is looking for ways to simplify the process, but in the meantime it should be

all hands on deck to raise college-going families’ awareness about the FAFSA and its importance,” said Rick Castellano, a spokesperson for Sallie Mae.

The upcoming FAFSA filing season begins Oct. 1 and runs through June 30. But Sallie Mae found that most families wait until at least January to complete the form, meaning they could miss out on some college funds.

“Free money, like grants or state-based aid and scholarships, is often offered on a first-come, first serve basis,” said Castellano, “so the earlier families complete the FAFSA, the better.”

It’s best to check with school financial aid offices on their preferred financial aid forms and deadlines.

“How Americans Pay for College” was an online survey conducted by Ipsos, which asked 1,000 parents of children ages 18 to 24 enrolled as undergraduate students and 1,000 undergraduate students ages 18 to 24). The full report is available at www.salliemae.com.

The survey uncovered other gaps in financial aid awareness. Of those who received financial aid, about one in five said they didn’t understand the terms and didn’t realize loans could be part of the aid package.

What’s wrong? Many parents certainly would research the price of a car or a new home before signing a contract; a college education, especially with a price tag in the tens of thousands over four or five years, requires homework too.

In addition, the survey found some parents didn’t realize their financial aid package might only be good for one year, and that awards in future years might not keep up with higher college costs.

About those rising costs, the survey had one piece of good news for families: Survey respondents with a child in college paid an average of $26,226 for the 2018-19 academic year, nearly the same as in 2017, the survey said.

Among other findings:

*Scholarships are the most widely used source to pay for college, with the funds covering about a third of college costs.

*Only about 19% of survey respondents applied for scholarships available in their community, such as from employers, nonprofits and churches.

*About two-thirds of families accepted whatever was offered in financial aid, while about 25% of families rejected part of the offer.

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