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It’s time to take the first step now for college aid

Updated: May 3, 2013 12:14PM

Originally published: February 19, 2004

The money will run out soon! I knew that would get your attention. And I’m serious about it. If you’re a high school senior who’s hoping to get financial aid for college this fall, you must take action now. Since many schools hand out financial aid on a first-come, first-served basis, you must get the application process started today, even before you hear whether you have been accepted to one or more colleges.

There is one central application for financial aid at any college or university -- public or private. It is used by almost every school as the first step in distributing grants, loans, work-study programs and federal student loan programs. It’s a federal application called the Free Application for Federal Student Aid, or FAFSA.

Your high school guidance office certainly has copies of the form, or you can get a paper copy at In fact, you can complete the application online at But be warned: Filling out the FAFSA form is not easy.

Filing for FAFSA

FAFSA is easily the most intrusive government form you’ll ever be asked to file. It asks not only about family income, but about assets held by both the student and the family. And it’s a time-consuming process, with more than 100 lines to complete, as well as assorted worksheets and explanatory notes. Here’s one piece of advice: If you’ve already completed your 2003 tax forms, the ones due in April, it’s a lot easier to file the FAFSA.

You should complete the FAFSA even if you don’t think you’ll qualify for financial aid based on need, because there are many scholarships available without regard to need. And be sure to make a copy of your application (or print it out if filing online) in case the government contacts you for verification.

The last section on the FAFSA form asks you to list up to six schools to which you’re applying. You’ll need the federal school code, available online at or from your high school guidance office. That’s important, because it leads to Step 2 of the financial aid process.

About two to four weeks after you complete the FAFSA, you’ll receive a Student Financial Aid report. It means the government has processed your application and has come up with a very important number -- the EFC, or Expected Family Contribution. That’s the amount the government feels you can contribute to your education - a key factor in your school’s calculation for financial aid.

The EFC report is also sent to every college you listed on the FAFSA form. That’s how they figure out how much financial aid to offer. But different colleges will offer different aid packages. And of course, some colleges are more expensive than others. So you can’t guess how much any one college will give you; you’ll have to wait a few weeks for Step 3.

Now students have a double reason to be nervous. You’re waiting for the acceptance letters, but you’re also waiting for the separate financial award letter, which will be sent soon after your acceptance letter.

That award letter can make or break your dream. If your first-choice school accepts you but offers a very low aid package, you may have to choose another school that offers more aid, or has a lower overall cost, meaning you and your parents have less of a gap to fill.

The aid package can come in several forms. Outright grants or scholarships are money that does not have to be repaid. That’s usually a very limited amount. The school may also offer work-study programs or other scholarships that have generous repayment terms. And finally, and probably most significant, the school will give you loan eligibility amounts for federal student aid programs, such as Stafford Loans.

Kitchen table calculations

So you’ll have to sit down at the kitchen table and figure out what deal works best for you and your family.

By now, you must feel overwhelmed, and in need of a college education just to get the financial aid process started! But there is help available. At College Loan Corporation (800-2-COLLEGE) or Collegiate Funding Services (888-423-7562) you can get help not only filling out FAFSA forms but also in the entire financial aid planning process.

Don’t procrastinate, or you’ll lose out on some great deals. And that’s The Savage Truth.

Terry Savage is a registered investment adviser and is on the board of the Chicago Mercantile Exchange. She appears weekly on WMAQ-Channel 5’s 4:30 p.m. newscast, and can be reached at

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