How Expected Family Contribution Affects Your FAFSA Eligibility

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Completing the FAFSA is an essential first step in preparing for college and how you'll pay for your education. This important document takes into account many factors, including your income and your family's income, family size and how many siblings you have in college. From this information, you will be issued an Expected Family Contribution (EFC), which dictates what you need to pay yourself. 

What Is the Expected Family Contribution?

When you complete the Free Application for Federal Student Aid (FAFSA), you will receive a Student Aid Report. It summarizes your information and gives you your EFC. The EFC is determined by a formula designed by Congress; it comes up with an estimate of how much you or your family can contribute towards your education expenses. It is the maximum expected contribution, not necessarily what you actually will pay. 

Colleges use the EFC by comparing it to their cost of attendance, which includes tuition, room and board, and other necessary expenses. Your EFC amount is subtracted for the school's cost of attendance to determine what financial aid you may be eligible for. 

EFC's Role in Financial Aid

Depending on the ratio between your school's cost of attendance and your EFC, you may be eligible for need-based aid. You may be a candidate for grants, which you do not pay back, or subsidized federal loans. If your EFC is high, you may not qualify for need-based aid, but you still could receive other forms of loans, like unsubsidized loans

Colleges may also grant you athletic or academic scholarships that are based on your skills and accomplishments. They do not take into account your EFC for these options. 

While many people think they make too much money for aid, it's still important to complete the FAFSA. Many families with higher incomes still qualify for some form of financial assistance. 

Changes To Family Finances

Your EFC can change drastically from year to year. If your family experiences financial hardship, such as the loss of a job, or if a sibling enters college while you're in school, the EFC may go down. If your family's situation improves, such as getting a significant raise, your EFC will go up too. 

Because of how much the EFC can vary, you need to complete the FAFSA and get a new Student Aid Report and EFC every year you are going to attend school. 

How Can You Lower Your EFC?

Many people think that they can change their EFC, and get more need-based aid, by leaving out a few extra points on the FAFSA or omitting information. But before you start thinking about telling any lies on your FAFSA to lower your expected family contribution, it’s important to realize that the penalties if caught can include stiff fines and jail time.

One way to cut your expected family contribution is to be declared an independent student, though this requires meeting certain criteria. By removing a parent’s income and assets, it could substantially decrease the EFC and qualify you for more financial aid.