Tips for Navigating the New FAFSA

My college freshman and I sat down last weekend to fill out the new FAFSA with some trepidation. The revised Free Application for Federal Student Aid was finally up and running at the end of December—sort of. According to reports we’ve received from friends and seen on social media, the “soft launch” (as described by the U.S. Department of Education) hasn’t been a smooth one.

This overhaul of the financial aid analysis and application process was mandated by the FAFSA Simplification Act, enacted in 2022 and now in effect for the 2024-25 school year. One aim was to expand access to federal aid for lower-income students; to that end, the law raised the amount of income that parents and students will not be expected to use for college and instructed the Department of Education to adjust that protected income for inflation annually. Another goal was to streamline the process by transferring tax information directly from the IRS.

Unfortunately, the simplified FAFSA hasn’t been that simple for many users. For one thing, the website has a number of bugs. Since the launch, the Department of Education’s Federal Student Aid office has identified 12 issues that can prevent a student from completing the application—for example, when a parent doesn’t have a Social Security number. Nine of these issues are still unresolved.

Then there are errors made by the students and families who are the de facto software testers for this new process. I haven’t yet made it all the way through the application myself (more on that below), but from what I’ve seen so far, poorly worded questions are a likely cause of human error.

It’s not all bad news, however.

“When it works, it’s amazing,” says Jill Desjean, senior policy analyst at the National Association of Student Financial Aid Administrators. If you’ve plodded through the 100-plus questions on the old application form in past years, you may find that the new one is a significant improvement.

The tips below will help you navigate the system.

Take Advantage of FAFSA Resources

Applicants are anxious, says Robert Muhammad, executive director of financial aid at Howard University, especially high school seniors waiting to compare aid packages from different schools. As a result, many families rushed to complete the delayed FAFSA when it was finally released. (It is normally available on Oct. 1.)

“Because of the level of angst, they aren’t necessarily using the tools the Department of Education provides through the FSA,” Muhammad notes. “Use resources, and don’t become panicked.”

Muhammad recommends the FSA’s educational videos. He also points to the many free webinars and other guides provided by high schools and colleges. “No one should be paid to help you to complete the FAFSA,” he emphasizes.

I found Sallie Mae’s guide useful. It includes screenshots of the actual questions and a how-to for answering them.

Approach the FAFSA Step-by-Step

The application requires a verified Federal Student Aid Identification, or FSA ID, and in most cases it must be completed by more than one person, each with their own ID. Here are the steps to take—in order.

1. Set up FSA IDs—and soon. A separate FSA ID is necessary for all “contributors,” to use the terminology of the new application. Contributors may include a student’s parents, the student’s spouse, and possibly parent’s spouses. You’ll want to set up each FSA ID at least a week before you plan to fill out the application because it can take several days to have the ID verified so that data can be pulled from the IRS database. If you already have an FSA ID from previous applications, it will work with the new one.
2. Log in with the student FSA ID and fill out the student portion of the form first. From this form, “invite” the required contributors to log in and fill out their sections. You may or may not be required to invite both parents, and/or stepparents, depending on the circumstances.
3. Use the link in the emailed invitation to have parents (and any other contributors) complete their application. Do not start a new form without that invitation because you may not be able to link your information to the student’s. Judging from complaints in social media, this is not an uncommon error.

I was foiled at the first step, though I didn’t realize it right away. I made my own FSA ID, then we logged on to the student portion of the form with my daughter’s ID, which she’d created last year. We completed her form, then I logged in through my invitation email and started in on the parent information—only to find that my IRS data could not be imported because my brand-new ID wasn’t yet verified.

As of this writing, I’m waiting for verification. I could have opted to enter the data manually instead. However, the questions were broadly worded, without reference to the corresponding line items on the 1040 income tax form. I feared that if I introduced any inconsistencies with my actual tax return, it would create problems down the road.

Read Each FAFSA Question Very Carefully

Seriously, read every single word. Twice. The questions on the new FAFSA do not seem to have been optimized to elicit accurate answers. One complaint I saw on social media is that students are mistakenly indicating that their parents refuse to provide their own information.

The convoluted prompt at issue: “Are the student’s parents unwilling to provide their information, but the student doesn’t have an unusual circumstance that prevents them from contacting or obtaining their parents’ information?” An answer of “Yes” means the parents won’t receive a contributor invite, making the student ineligible to be considered for a Pell Grant or a subsidized federal loan.

Another source of confusion is a question for parents about benefits from certain federal programs that are indicators of financial need. One of the benefits listed is “free or reduced price school lunch.” Several states, including California and Michigan, offer all students free lunch, regardless of income, and some parents in these states are checking this option without realizing that they may not meet requirements for the federal program.

Don’t Wait to Fill Out the FAFSA

These kinds of errors need to be corrected to ensure an accurate Student Aid Index, the key number used in financial aid calculations. (The SAI replaces the Expected Family Contribution previously used; unlike the EFC, it is not expressed as a dollar amount.) Unfortunately, once submitted, an application cannot be corrected until it is “processed” by the Federal Student Aid office. And applications won’t be processed until the end of January, in the best-case scenario.

It might therefore be tempting to postpone applying until the kinks have been worked out. But Muhammad advises against waiting: “Complete the form and make changes later [if necessary]. It’s good to have it in the queue.”

“Do it as early as you can,” agrees Desjean, noting that some schools take a first-come, first-served approach to distributing aid. If you do end up needing to make changes, try to do so within the first few days of your application being processed. Then the schools on your FAFSA list will receive the corrected application in time to factor it into their aid decisions.

Desjean notes that it may take schools “weeks, and even months” to adjust their financial aid management systems to accommodate the new SAIs once they receive them.

Factoring in Inflation

There’s another variable in the mix now: That inflation adjustment mandated by Congress back in 2022 somehow never made its way into the new FAFSA income formula. This omission is particularly egregious given recent high inflation. Lawmakers pushed back, and on Jan. 23, the Department of Education announced that the inflation adjustment will be incorporated in time for the 2024-25 school year.

This will mean further delay for schools and students. But it also means that, in the end, more families will get more aid.