Why is the FAFSA changing?

The FAFSA Simplification Act has recently been passed by Congress to streamline the financial aid process for students and families, and is a sweeping redesign of the processes and systems used to award federal student aid. Specifically, this law makes it easier for students and families to complete and submit the Free Application for Federal Student Aid (FAFSA®) form, attempts to clarify the questions that will be asked, and expands access to federal student aid.

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What does this mean for students and families?

Some of the key changes that will affect our students and families completing the FAFSA are as follows:

• The Estimated Family Contribution (EFC) has been replaced by the Student Aid Index (SAI). The SAI is a different way to determine aid eligibility.  

• The FAFSA Simplification Act expands the Federal Pell Grant to more students and will link eligibility to family size and the federal poverty level. 

• Schools will use the SAI to determine eligibility for federal financial aid programs. Montco will also use the SAI to determine financial need for need-based institutional funding. 

• SAI will no longer take the number of students in college into consideration. This may reduce need-based aid eligibility for current students with siblings in college.  
• For students whose parents are separated or divorced, the guidance on which parent income to report has changed to the parent who provides the most financial support to the student, rather than the parent who lives at the student’s primary residence.
• Parents without a Social Security Number will be able to apply for an FSA ID. This will speed up FAFSA processing time as they’ll be able to submit the form online, rather than having to print, sign and mail their application.
• Students who qualify for a dependency override due to homelessness or not being able to access their parents’ financials, no longer need to re-certify their dependency status each year, unless their situation changes. 

You will also notice a few new terms on the new FAFSA. Some of these include:

• Contributor: anyone who is asked to provide information on the FAFSA – student, student spouse, parent(s), and stepparent(s) for example. 
• Consent: each contributor will now need to provide their consent to their Federal Tax Information (FTI) being included in the FAFSA, even if they did not file a U.S. tax return. 
• SAI: Student Index Aid (SAI) replaces the Expected Family Contribution (EFC). 
• FTI: Federal Tax Information (FTI) transferred directly from the IRS. 
  
  

For More information about FAFSA Simplification, please check out this short video:

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Next Steps and Additional Information

Stay connected and up to date with the Federal Student Aid Simplification Act. 

Learn more about financial aid through informative video segments geared toward students and parents.