The “FAFSA Simplification Act” is Not So Simple: Here’s What You Need to Know

Nothing about the Free Application for Federal Student Aid (FAFSA) form and process has ever been easy. Now comes the “FAFSA Simplification Act” starting with the 2024-2025 financial aid award year, with an overhaul of several aspects, including the form itself and the way awards are calculated. Although the long-term goal is simplification, we all know that change is never easy. Let’s take a look.

The good news for students and parents is that the most complicated changes are directed at the financial aid departments of universities. Internally, institutions will have new regulations and guidelines and, most importantly, a whole new formula for calculating what is now called the Student Aid Index (SAI), replacing the previously named Expected Family Contribution (EFC). Institutions will also use a new method for determining Pell Federal grant recipients, so overall, we anticipate that there will be an increase in the number of Pell Grant awards and their dollar size. 

But for a student or parent, what are some of the key changes to be aware of?

FAFSA Form Not Available Until December 2023

Perhaps the biggest impact for students applying for 2024-25 financial aid is that this year’s form will not be available until December, two months later than usual. Ultimately, that will push back the timing of when students receive their financial aid packages. In the past, students who had received an Early Decision or Early Action acceptance in December or January might also simultaneously have received their financial aid award notification. This year, students must be patient—colleges will not only just be starting in December, but they also will be dealing with a learning curve in implementing the new calculation process.

Student Aid Index

As mentioned above, the wording Expected Family Contribution (EFC) will be replaced with the Student Aid Index (SAI). This also reflects a shift to a more student-driven FAFSA form and process, as opposed to a form and process where parents took the lead. SAI will also bring a new methodology for determining aid. According to the Federal Student Aid (FSA) website, “the new need analysis formula removes the number of family members in college from the calculation, allows a minimum SAI of -1500, and implements separate eligibility determination criteria for Federal Pell Grants.” 

That part about family members in college is significant because previously, families benefited in financial aid if they had more than one child enrolled in college. Now, eligibility will be more closely linked to family size and financial means. 

Shorter Form

It’s the best news amid the changes! The FAFSA form will be shorter! Several questions have been deleted, as the form will rely more heavily on a family’s tax information. There will be a couple of new questions about ethnicity and gender, and about whether the family has a farm or small business. 

More Information

Our Score at the Top Educational Consultants will continue to monitor the FAFSA changes and updates and pass along information to you as we get it. You can also head over to the FSA website at studentaid.gov for details. 

We’re always here to help with your entire college planning journey. Contact us for a free consultation with one of our experts.