12 Changes to the FAFSA in 2024

Hello, and welcome to a new year!

We had an article last fall about the purpose and use of the FAFSA, or Free Application for Federal Study Aid. The application has just undergone a massive overhaul, and I wanted to take some time to talk through some of the changes.

Here are 12 changes coming to the FAFSA in 2024:

1. Simplified Application Process: The FAFSA will undergo a major overhaul to make it more user-friendly and less time-consuming. The application will be streamlined, reducing the number of questions and making it easier for students and their families to complete. 

2. Prior-Prior Year (PPY) Income Data: Starting in 2024, students will be able to use income data from two years prior to the academic year they are applying for. This change aims to provide a more accurate reflection of a family's financial situation and eliminate the need for estimates.

3. Removal of Asset Questions: The FAFSA will no longer require students and their families to report asset information, such as savings and investments. This change will simplify the application process and reduce the burden on applicants.

4. Automatic Zero SAI/EFC for Certain Students: Students who are eligible for means-tested federal benefits, such as the Supplemental Nutrition Assistance Program (SNAP) or Temporary Assistance for Needy Families (TANF), will automatically be assigned a zero Student Aid Index (SAI). This change aims to ensure that students from low-income backgrounds receive the financial aid they need.

5. Expanded Pell Grant Eligibility: The income threshold for Pell Grant eligibility will be increased, allowing more students from low-income families to qualify for this need-based grant. This change will help make college more affordable for those who need it most.

6. Simplified Verification Process: The FAFSA verification process, which requires selected applicants to provide additional documentation to confirm the accuracy of their application, will be simplified. This change aims to reduce the burden on students and their families and make the process more efficient.

7. Increased Access to Professional Judgment: Financial aid administrators will have more flexibility to exercise professional judgment when determining a student's eligibility for aid. This change will allow administrators to consider special circumstances that may affect a student's ability to pay for college.

8. Enhanced Data Sharing: The FAFSA will allow for enhanced data sharing between the IRS and the Department of Education. This change will streamline the verification process and reduce the need for applicants to provide duplicate information.

9. Improved User Experience: The FAFSA website and application interface will be redesigned to provide a more intuitive and user-friendly experience. This change aims to make the application process less daunting and more accessible to all students.

10. Increased Awareness and Outreach: The Department of Education will launch a comprehensive awareness and outreach campaign to ensure that students and their families are aware of the changes to the FAFSA and understand how to navigate the application process. This change aims to increase access to financial aid for all eligible students.

11. Removed Multi-Student Discount: The calculation no longer takes into account whether the family has multiple sutdents in college at the same time, though most states and colleges have said they would independently take it into consideration, so make sure to communicate if you have multiple students in college at the same time.

12. Small Business and Farm Assets: Under the new formula the value of a small business or family farm is also considered in calculating the Student Aid Index.

Additional changes are coming, but these are some of the highlights. Students and their families need to stay informed and take advantage of these updates to maximize their eligibility for financial aid.

Even though the new FAFSA was released in December, there are still (at time of publishing, January 8th, 2024) several reports of difficulty with the application, so we recommend you wait to complete the FAFSA for another week or so to allow some time for things to be ironed out (they will not be submitting data to colleges till the end of the month or February.

Have questions about the FAFSA or other aspects of college financing? Post them here and we'll take care of getting them answered!