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7 Changes to the FAFSA and How They Could Impact You Thumbnail

7 Changes to the FAFSA and How They Could Impact You

Deciding on which college to attend is an exciting time. Still, it can also be stressful. The Department of Education has been working to simplify the Free Application for Federal Student Aid (FAFSA) application process with a few modifications. Here are seven notable changes that could impact you:

 1. It will be easier to receive a Pell Grant

  • Pell Grant eligibility will be expanded.
  • Students who don’t qualify for the maximum Pell Grant could still receive funds if their Student Aid Index (SAI) is less than the Pell Grant maximum. The SAI is a number that is calculated based on the student’s and parents’ (if applicable) income, asset, tax, and demographic information on the FAFSA. Adjustments are made for family size, however, the number of children in college at the same time is no longer used with parent contribution to calculate SAI.
  • Students could receive a minimum grant if they qualify based on adjusted gross income (AGI), family size, and poverty guidelines.
  • Federal Pell Grant lifetime eligibility will be restored to students who were enrolled in schools that closed while they were attending, or schools that mislead students.

 2. Expected Family Contribution (EFC) replaced with Student Aid Index (SAI)

  • The term “expected family contribution” was seen as misleading because many families believed that was all they had to contribute. In fact, most families pay more than the EFC. The name changes do not make college more affordable or filling out the FAFSA application any easier. Changing the name was part of legislation to simplify the FAFSA. 

 3. The application will be in more languages

  • The new form will be available in up to 11 languages, whereas the current application is only in English and Spanish.

 4. Modification of the cost of attendance (COA) components

  • Transportation expenses may include transportation between campus, residences, and a student’s place of work.
  • Institutions may no longer include loan fees for non-Federal student loans borrowed by students.
  • The costs of obtaining a certification, license, or first professional credential are no longer restricted to a one-time allowance. They are added to an institution's expenses in the COA for an incarcerated individual.
  • Specific expenses an institution includes in the COA for a student enrolled less than half-time have been expanded to include components not otherwise prohibited by the law. An example of this is an allowance for students in work related to a cooperative education program is permitted.
  • The language for some questions has been revised. For example, “tuition and fees” has been changed to “books, course materials, supplies, and equipment.”

 5. Students could receive more need-based aid

  • Colleges are able to identify students who need greater financial assistance by using the SAI. The lower the number the more financial help the student needs. The negative SAI number can be as low as -1500, however, negative numbers do not increase eligibility for federal student aid or allow financial aid to surpass the college’s COA.

 6. Streamlining the FAFSA form

  • Data received directly from the IRS will be used to calculate Federal Pell Grant eligibility and the SAI by way of the Fostering Undergraduate Talent by Unlocking Resources for Education Act (FUTURE Act). This allows the IRS to provide certain taxpayer information to the Department of Education for the purpose of administering certain federal student aid programs. The goal of this change is to:
    • Improve the experience by allowing the Department of Education to automatically obtain federal tax information for each applicant, parent, or spouse who provides consent.
    • Improve the integrity of the program for income-driven repayment plans and permanent disability discharge monitoring.
    • Enhance the experience of the 43 million customers of the Department of Education.

 7. Personal Information

  • Selective Service Questions – Due to changes in student eligibility for Title IV funding, the 2023-24 form no longer contains Selective Service Registration questions.
    • The Selective Service registration required male students under age 26 to enroll in the military draft. This was removed a few years ago as part of the FAFSA Simplification Act.
  • Drug Conviction questions – The form no longer contains drug conviction questions.
  • Sex, Race, & Ethnicity – The form will, however, add questions regarding an applicant’s sex, race, & ethnicity, which do not effect federal student eligibility.
  • Incarcerated students – Students who may be incarcerated in federal and state penal facilities will again be allowed to receive a Federal Pell Grant.


To learn about which FAFSA changes may impact you, consider consulting a financial professional who can review your current condition and help you create a strategy that aligns with your financial and educational goals.


This article was prepared by LPL Marketing Solutions


What is the Student Aid Index (SAI) - Savingforcollege.com

FAFSA® Simplification Act Changes for Implementation in 2023-24 | Knowledge Center

What is the FAFSA Simplification Act? | Federal Student Aid

Fostering Undergraduate Talent by Unlocking Resources for Education Act Implementation Update (studentaid.gov)

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