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File financial aid forms now or miss out on funds

Planning attend college? It's time get started filing financial aid forms. | Stephanie Dowell~Sun-Times Media

Planning to attend college? It's time to get started on filing financial aid forms. | Stephanie Dowell~Sun-Times Media

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Updated: May 3, 2013 12:15PM

Don’t just sit around worried about the fiscal cliff and your taxes. You can’t do anything about that. But here’s something you can do now to impact your finances next year — if you’re the parent of a high school senior. And if parents are procrastinators, students need to do the pushing on this one.

It’s time to fill out FAFSA — the Free Application for Federal Student Aid — an experience often likened to undergoing root canal. But you can’t get financial aid money for college if you don’t fill out this standardized government form. And putting it off will actually cost you money, since most financial aid is given out on a “first come-first served” basis.

Yes, the FAFSA requires information about your income and tax situation from 2012 — but you definitely don’t want to wait until your tax return is finished. You can estimate closely, based on last year’s income and deductions, and then amend the FAFSA form if anything changes significantly in April. Only major changes, such as a divorce or job loss, are likely to impact your aid package from this point on.

Remember, the FAFSA form wants to know everything about your financial situation — not just your income last year. You’ll be divulging information about your family, all your assets, and your complete family financial situation.

At this point, it’s too late to make changes in your 2012 information. But parents of younger children headed to college might want to check out FAFSA to make some adjustments before it’s their turn to file. For example, money held in a child’s name in a custodial account weighs at last five times more heavily against you in the aid formula. And making a big retirement contribution could reduce your income, since your retirement assets are not weighed in the formula. Beyond that, you’re pretty well stuck with the picture you’ve created for the 2013 FAFSA. But remember, you will have to file this form every year your child applies for aid, so you can make changes for next year.

Getting started

The easiest way to handle this project is to go to and click on “Start a New Application.” You don’t have to do it all in one sitting, so you can save the information and create your own private, password-protected file. And here’s a word of warning: These forms are very specific. Be sure to use your child’s full name as it is on his or her birth certificate or Social Security card, and be sure to complete the parental information section accurately, as well.

This is a “blind” online format. That is, they won’t let you move forward from page to page, until you have completely filled in the information required on the current page. I think they do that so you have no idea what you’re getting into!

So if you’re naturally curious, here’s another place to visit — even before you start filling out the form. At you can learn everything you need to know about financial aid by using the “Tuition Coach” tool. It will help you fill out financial aid forms accurately and in the way that lets you qualify for the most aid possible. You can find it by clicking the “More” tab on the home page.

The TuitionCoach service is free, but you have to sign up for it and give your personal information. Don’t worry about the security of this site. It is one of the best on the web when it comes to helping families understand the financial aid process.

The FAFSA form is designed to let families know how much money they will be expected to pay for their child’s education — the EFD or Expected Family Contribution. At under the “More” tab, you will also find a quick calculator so you can make an educated guess at what the FAFSA from will eventually tell you.

Student loans in perspective

Recent college graduates have learned about the burden of student loans the hard way. In past years, few planned ahead to consider the total repayment cost. And, of course, recent grads have faced a very tough job market. But for those entering college today, there is almost certainly going to be a more welcoming economy upon graduation. And your college education will pay for itself — if you plan wisely.

The key to managing student loans from the start is getting the total picture of the cost of the college you choose — and the aid package you are ultimately offered. A more expensive school might be within your reach if they are willing to give you a larger package of financial aid — including federal student loans, grants, scholarships, and work-study programs.

One more tip in the process: also has a “College Cost Adjustor” tool which will help you compare the aid packages when they arrive, so you make a choice based on value — not only the bottom line, but the total repayment cost.

But you can’t even get started in the process if you haven’t filled out the FAFSA.

Your family might not qualify for much federal student aid based on need — but if you get your resume and application in front of several schools, you might be surprised at what other financial aid they will offer to get you to attend, especially now that many families are hesitating about college affordability.

You remember the old saying: “The early bird gets the worm.” For college aid, it’s the early FAFSA that gets the funds. And that’s the Savage Truth.

Terry Savage is the Chicago Sun-Times’ nationally syndicated financial columnist, and a registered investment adviser.

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