Simplifying the College Aid Form
By: Brian O'Connell

Parents dread it. College applicants can’t understand it. And even college admissions officers admit it can read like the U.S. tax code.

So maybe those reasons have something to do with big changes in store for the college financial aid-form – with the primary goal of easing the way parents can figure out how much federal aid they might get, and how much of junior’s sheepskin will come out of their own pockets.

Proponents say easing the college federal aid form is an idea whose time has come. According to the American Council on Education, 1.5 million U.S. students who qualified for federal financial aid didn’t even bother to fill out the form in 2008. The form itself is an eight-page, 153-question monster that only a Washington bureaucrat could love. Perhaps that’s why simplifying the Free Application for Federal Student Aid (FAFSA) form represents a “crying need” according to U.S. Department of Education.

The new form will take shape in fits and stages, says the U.S. Department of Education in a statement released on June 24. The same day, U.S. Education Secretary Arne Duncan spelled out how the new and improved FAFSA form might look, and when the new features kick in:

• Launch Date: May 9, 2009 – The FAFSA online application, run by the Education Department, began providing instant estimates of Pell Grant and student loan, rather than forcing applicants to wait weeks for answers. Links to graduation rates and other college information are now also provided.

• Launch Date: Summer, 2009 - Enhanced “skip-logic” (which allows users to create customized paths through the FAFSA process) used in the new web-based FAFSA will reduce user navigation for many applicants by more than half, the Education Dept. estimates.

• Launch Date: January 2010 - Students applying for financial aid for the spring semester will be able to seamlessly retrieve their relevant tax information from the IRS for easy completion of the online FAFSA. The Department of Education and the IRS will work together to examine the possibility of expanding this option to all students in the future.

In addition, the Obama White House will also seek to craft legislation that would remove 26 questions from the FAFSA form – mostly to streamline the financial aid calculations that families need to navigate. The Education Department says the 26 questions
“have little impact on aid awards and can be difficult to complete”.

The Education Department is touting the new FAFSA form as a way to enhance quicker aid estimates and make it much easier for students and their families to fill out the federal aid form. The revamped form could be coming just in time – the U.S Dept. of Education estimates that demand for student aid is growing at a 12% rate (per 2008 figures) to 16 million students.

With over $5 billion in Uncle Sam’s FAFSA coffers, scores of anxious parents should certainly appreciate the help.

—For more ways to save, spend, invest and borrow, visit MainStreet.com.

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