What advice can you give to clients with children approachingcollege age, to help them stand the best chance of qualifying forfinancial aid? Here are a few ideas:

All colleges require students who wish to be considered forfinancial aid file the Free Application for Federal StudentAssistance. In addition, many parents complete the CollegeScholarship Service Profile, a financial aid application developedby The College Board and used by more than 300 private colleges anduniversities. The CSS Profile, which includes more extensiveinformation than the FAFSA, is often called the “institutionalmethodology” – as opposed to the FAFSA’s “federal methodology.”

Parents should not wait until their FAFSA filing deadline tobegin planning for needs-based aid. DOE has created an online toolcalled FAFSA4caster thatcan be used to preview the FAFSA and model “what-if” scenarios.

Most types of financial aid (except Direct Unsubsidized Loansand PLUS Loans) are based on financial need, which is determinedlargely by the “bottom line” of the FAFSA, Expected FamilyContribution. For dependent students, EFC is based on the incomeand assets of both the student and parents. Most singleundergraduates who have not attained age 24 are dependent. Forindependent students, EFC is based on the income and assets of thestudent only. Students age 24 and older, or working on a master’sor doctorate degree, are independent.

For dependents, income and assets of both parents usually areconsidered, even if only one parent is providing for college costs.Income and assets of grandparents (and other relatives) are notincluded in the FAFSA, even if they are assisting with collegecosts.

FAFSA income and assets are reported for each “base year,” thefull tax year before the academic year begins. For mostundergraduates, four FAFSAs will be filed for four separateacademic years and base (tax) years.

It’s always a good idea to file a federal tax return before eachyear’s FAFSA is submitted, so data on the return and FAFSA align.The best way to insure alignment is to file taxes early and thenuse the IRS Data Retrieval Tool to import federal income and taxdata directly into the FAFSA. (When completing the FAFSA, taxfilers are redirected to a secure IRS website, where they give theIRS permission to transfer income and tax data to the FAFSA.)

For more information, check out the U.S. Department of Education’s FAFSAhomepage.