By Paige Chapman-Layland
Have you heard the news? According to a recent article in The New York Times, the EFC (Expected Family Contribution) has been kicked to the curb! That’s right, FAFSA filers, the EFC is outta here.
While this might seem cause for much rejoicing, know that while the EFC is going away, the Student Aid index will take its place.
In a December 30, 2020 NYT article, Ron Lieber reports,
Among the orders and edicts spilling into the 5,000-plus pages
of the bill that President Trump signed into law on Sunday night
was one that strikes the three words (Expected Family Contribution)
From the Higher Education Act and replaces them with “student aid index.”
The formula to determine the new index will change as well. In this attempt at FAFSA simplification, many more people will be eligible for Pell grants, the maximum award of the Pell grant has been increased, and the limitation on lifetime subsidized loan eligibility, known as Subsidized Usage Limit Applies (SULA) has been repealed.
That’s the good news.
The less good news is that while divorced or separated parents would continue to share only one parent’s information on the FAFSA, that parent will be determined based on which parent provided the greater portion of the student’s financial support, instead of the parent with 51%+ custody.
To check out all of the proposed changes, visit www.nasfaa.org (National Association of Student Financial Aid Administrators), and as always, feel free to ask IN, the college planning experts any questions you may have.