If you have children heading to college next year, keep in mind that the Free Application for Federal Student Aid (“FAFSA”) window opens on December 1. This is a new deadline based on major changes that are coming to the form for 2024-25. The FAFSA is used by the federal government to determine if a student is eligible for various federal financial aid programs. It is best to complete the FAFSA as early as possible because many states and colleges also use it to award their own grants, scholarships and loans, and that aid is limited.
The Importance of a College Education
A college education can be a gateway to many career and life opportunities for your children. Besides knowledge and skills needed for many career options, college promotes critical thinking, communications skills and a broader world view.
A college education can lead to:
- Enhanced career opportunities
- Personal growth
- Networking opportunities
- Higher lifetime earning potential
Key Dates to Remember
The earliest date to submit the FAFSA for the next college year is December 1. In the past, the form was available October 1, but due to changes and improvements, the new form will be available in December 2023, not Oct. 1. If you cannot submit the application by that date, it is important to try to complete the FAFSA for your student as soon after that date as possible. This allows your child to receive consideration for a variety of aid opportunities that can help offset the high cost of college. The latest date the FAFSA for the upcoming school year can be submitted is June 1.
Completing the FAFSA as early as possible is important for a number of reasons, including:
- Some forms of financial aid are distributed on a first come, first served basis. · In some cases, there is only a finite amount of aid available, meaning that when it is gone, it is gone.
- Receiving responses from some aid providers early on can provide families with a clearer picture of their financial situation for the upcoming school year. Early decisions allow parents the opportunity to explore additional options if needed. Waiting until the last minute to apply may limit additional options for your student.
- Early applicants may have access to a wide range of grants, scholarships and low interest loans.
- Early applicants may also have greater access to one of the many work-study programs available.
Besides the federal filing deadlines, some states may have different deadlines. These dates are important in that there can be state aid available in some cases.
Dependent students will need to provide both their own financial information as well as information for their parents. An independent student needs to include only their own financial information.
The type of information that is generally needed to file the FAFSA include:
- The Social Security numbers of the student and their parents. If the applicant or the parents are not U.S. citizens then their alien registration number will be needed.
- Federal tax returns, any W-2 or 1099 forms and other applicable information to document the income of the student and their parents.
- Bank and investment account information may be required in some cases. This might include information about any 529 plans depending upon the ownership.
- Any information about untaxed income if applicable.
We strongly encourage you to gather all necessary information prior to starting to complete the FAFSA form. This will make the process go much smoother for you and make it less likely that you will make an error or omit key information that could delay the finalization of your submission.
Help Completing the FAFSA
There is help available to complete the FAFSA and to answer questions you may have. Many states offer online help and, in some cases, workshops. There is a federal student aid online guide available as well. Beyond this, there are a number of online workshops on how to complete the FAFSA.
The FAFSA is a key part of your efforts to cover the costs of college for your college aged kids each year. It is important to complete and submit the FAFSA as soon as possible after the October 1 start date. This allows your student to be considered for all types of aid, whether at the federal, state or institutional level.
College can be very costly between tuition, books, room and board as well as other costs. Avoiding debt to the extent possible for your student can help them on their way towards building a financially successful future once they graduate.
Contact your Wedbush advisor with questions about funding college expenses for your kids. They can help incorporate this into your financial planning efforts.
Wedbush Securities does not provide tax or legal advice. Please consult your tax or legal advisor.
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information presented is not intended to constitute an investment recommendation for, or advice to, any specific person. The information presented here is not specific to any individual’s personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. The information in these materials may change at any time and without notice.