The FAFSA for Graduate School: What You Need to Know
Getting into graduate programs is an accomplishment worth celebrating. After the initial excitement, however, you’ll need to plan out how to prepare and pay for graduate school.
Filing a Free Application for Federal Student Aid (FAFSA) is a critical step. The process for graduate school is similar to what you went through as an undergrad, but there are some key differences.
Undergraduate vs. Graduate
When filing the FAFSA, you’re considered a graduate or professional student if you’re enrolled in any post-secondary schooling beyond a bachelor’s degree, such as a master’s degree, a medical degree, or a doctoral degree like a Ph.D. (A professional degree usually refers to preparation for a specific career, such as a law degree or pharmacy degree.)
This distinction is crucial because graduate and professional students are almost always granted independent status on the FAFSA. (Whereas undergraduates pursuing a bachelor’s degree are mostly classified as dependent).
As an independent student, you won’t be required to have your parents provide financial information on the FAFSA. Instead, you’ll provide only your own and your spouse’s, if you’re married.
Just as with undergraduates, you’re eligible to file the FAFSA as long as you meet some basic requirements. These include being a U.S. citizen or eligible noncitizen with a valid Social Security number and being accepted or enrolled into an eligible degree program.
Types of Student Aid Offered to Graduate Students
The U.S. Department of Education and your school’s financial aid office use your FAFSA to determine if you’re eligible for student aid, and for which kinds. Some forms of aid are need-based and some aren’t.
The federal government has fewer options for graduate students than for undergraduates, generally speaking. However, your own university or graduate program might provide merit- or research-based assistance, and many private nonprofits and organizations offer scholarships and grants for graduate students as well.
Here are the types of federal need-based aid offered to graduate students:
- Federal Pell Grants are largely reserved for undergraduate students, but graduate students in a post-baccalaureate teacher certification program may also be eligible. You don’t have to repay Pell Grants, and the maximum award is $6,195 for 2019-20.
- TEACH Grants offer as much as $4,000 a year to students in participating undergraduate, graduate or postbaccalaureate programs who are pursuing a teaching career. To receive this aid you must sign an agreement committing to teach in a high-need area after graduation.
- Federal Work-Study provides aid in the form of wages earned through part-time employment.
Besides these forms of aid, there are two types of federal loans offered to graduate students. Neither are based on financial need.
- Direct Unsubsidized Loans for graduate students are limited to $20,500 per school year. They carry a 6.08% interest rate for the 2019-2020 school year, and there is a one-time origination fee of 1.059%-1.062% of the loan amount, depending on the date the loan is made.
- Direct PLUS Loans, called Grad PLUS loans when taken out by grad students, don’t have a preset limit. Graduate students can borrow up to their school’s cost of attendance, minus any other aid they’ve received. These loans carry a 7.08% interest rate for 2019-2020, and the origination fee is 4.236%-4.248% of the loan amount, depending on when the loan is made.
Federal student loans can be a vital source of funding for graduate and professional students. In 2017-2018, they took out $37.6 billion in federal student loans, 40% of all the government loan funds disbursed that year.
Aid is typically paid out in two or more payments and with at least one payment per term. The Education Department pays your school, which will usually apply the money to outstanding charges from the college first. Any remaining funds will go to you.
Do Graduate Students Have to File a FAFSA?
Filing a FAFSA is required to access federal student aid, and is often a prerequisite for other types of aid as well, including grants and scholarships from state governments and universities.
Even if you don’t want or plan to get aid, filing your FAFSA can provide an important backup option for covering costs.
Steps to File Your FAFSA for Graduate School
Fortunately, filing a FAFSA online takes just 30 minutes and is fairly simple. Go to FAFSA.ed.gov to start the process.
1. Get Set Up
A Federal Student Aid ID, or FSA ID, and account are required to sign in and start the FAFSA process. Once you’ve got those, you’ll need to indicate the school year for which you’re filing and that you’re a student, not a parent.
(The FAFSA site will also prompt you to create a save key to save your progress in case you don’t complete the form in one go.)
2. Provide Student Information
Next, you’ll be asked to provide a series of personal and demographic information, such as residency and contact information, and marital status.
3. School Section
This is where you’ll enter information about all schools you’re enrolled in or considering attending.
4. Dependency Status
Next, the FAFSA will ask you a series of questions about your dependency status. This includes a question about whether you’re beginning a master’s or doctorate program. You should indicate yes to be classified as an independent student.
5. Parent Demographics (Optional)
As an independent student, you’re not required to provide parental information.
6. Student Financial Information
Next, you’ll be asked to provide financial information from a specific tax return. You can do so by entering your tax data manually or using the IRS Data Retrieval Tool. Then there are some additional questions about income, assets, and other financial details.
7. Sign and Submit
The last step is to sign the FAFSA electronically and then submit. And you’re done!
After Submitting the FAFSA
The Federal Student Aid office will process your FAFSA in three to five days and send a Student Aid Report (SAR) to you and the colleges where you’ve applied or enrolled. From there, each college will put together a financial aid package. This will list the types and amounts of student aid the college can extend to you in the coming school year.
When you receive your financial aid package, review it and carefully decide which types of aid to accept. Use any gift aid first, such as scholarships or grants, followed by any offers for work-study or a fellowship stipend.
This will help you limit how much you need to borrow for grad school. If you do need loans, max out lower-cost Direct Unsubsidized Loans first and then use Grad PLUS Loans to fill in any remaining gaps.