The new FAFSA form has been simplified, allowing students to submit their financial aid application more efficiently. This change will eliminate around 20-30 questions from the previous form, which aims to reduce the amount of confusion surrounding the financial aid process. However, removing certain questions means an applicant’s dependency status may become less transparent. For example, some students who might have previously qualified as independent may now have to provide their parent’s financial information to determine their financial aid eligibility.
In previous years, students could submit their FAFSA form on or after October 1st, but now, the application opens several months earlier for the upcoming academic year. This change implies that students from low-income families or those dependent on financial aid will have more time to make informed college selection decisions. On this note, early submission of the form increases a student’s chances of receiving more aid since financial aid is awarded on a first-come, first-served basis.
Dependency overrides may pose an issue for institutions to consider while evaluating a student’s financial aid eligibility. The new FAFSA form has no drop-down menu to provide further information on relying on a dependency override. Still, it allows students to explain why they’re requesting this override. Higher education leadership is granted the task of challenging those dependency override requests seen as fraudulent or inadequate.
Another implication is the changes brought to Pell Grant eligibility. The Pell Grant program is a federally funded grant specifically intended for low-income and working-class students. Starting from the 2021-22 academic year, more students are eligible for the maximum Pell Grant award of $6,495. However, for students to receive this increased award amount, they must meet more stringent criteria, such as having an EFC (Expected Family Contribution) of zero, rather than the previous requirement of 5711$.
The changes made to the FAFSA form will have a ripple effect on institutional financial aid packages. With the introduction of simplification, institutional financial aid offices will forward more financial aid to prospective students since fewer questions have been steered away from ascertaining financial assistance eligibility. As more students gain access to financial aid packages, the likelihood of institutions meeting projected net revenue goals through student tuition and fees would be undermined.
Finally, the changes made to the FAFSA form will have significant financial implications for students. As this change takes effect to foster more clarity around the financial aid application process, these financial implications will impact higher education leadership and the institution’s financial department. Institutions need to adjust their institutional financial aid packages to align with what the new FAFSA information now provides. Financial aid administrators should ensure that more investment is being made in staff development and training to provide guidance services to students, which will require more financial resources to ensure students can access them. Higher education leaders must stay informed about the changes and remain ready to adapt to changes in financial assistance eligibility, leaving no student missing out on educational opportunities.
