Another change is coming to the FAFSA process. It fixes a $1.8 billion mistake
The U.S. Department of Education is updating the new Free Application for Federal Student Aid again. This time, it’s fixing a $1.8 billion mistake.
The department said it would add adjustments for inflation to accurately reflect family income, resulting in more students able to qualify for federal financial aid, according to a news release from the National Association of Student Financial Aid Administrators and NPR reporting.
A spokesperson for the department told McClatchy News that it would update the income tables, which will give students access to another $1.8 billion in aid.
“Adjusting these inflationary numbers is the right thing to do, and should have been done from the beginning,” NASFAA President Justin Draeger said in a statement. “Unfortunately, because the Department is making these updates so late in the financial aid processing cycle, students will now pay the price in the form of additional delays in financial aid offers and compressed decision-making timelines.”
The spokesperson said the department would provide details on the update’s timeline soon. But right now, it’s not clear if the change will affect the timeline for FAFSA information being sent to schools. That is supposed to happen in late January.
“The Biden-Harris Administration is committed to making higher education possible for more students, including through ensuring students qualify for as much financial aid as possible,” the spokesperson said in a statement.
The FAFSA soft-launched at the end of 2023 but wasn’t fully available until later in January. It was already delayed from the usual October launch date.
It was updated for the 2024- 2025 school year as a result of the FAFSA Simplification Act, which Congress passed in December 2020 as an overhaul of the federal student aid systems and processes.
One of the changes: It replaced the Expected Family Contribution with the Student Aid Index as a measure of a student and their family’s ability to pay for college. The Washington Post reported the inflation adjustment was supposed to be based off the consumer price index from April 2020 to April 2023. Without the adjustment, which was required by the FAFSA Simplification Act, some students wouldn’t have been eligible for aid.
The form puts you in the consideration for federal student aid for the upcoming school year.
Plus, states and colleges use the information to award grants, scholarships and loans.
States and schools set their own deadlines, so it’s best to apply as early as possible.
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This story was originally published January 25, 2024 at 4:43 PM with the headline "Another change is coming to the FAFSA process. It fixes a $1.8 billion mistake."
