FAFSA & EFC

[.edu-MD]

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I just filed my FAFSA and was horrified to see an EFC of $30668!

I thought they assumed the student would have a zero income while in school?? What am I supposed to live off? What kind of EFCs are other people seeing?

 

[motox]

Mine came in at about $15k with both my wife and I working full time and no savings. I also was wondering how they can take your income from last year into account when I have to quit work completely and my wife must find another job in a different state?

 

[Doctor Bagel]

Bumping this because I'm wondering who else got ridiculous results. My EFC is $22k, and yeah, that's not happening. I know this doesn't affect my ability to get federal and private loans, so I guess I'm still okay.

 

[blee]

This time around, we got lucky; our EFC is $21k. In contrast, when I applied for aid for my post-bacc year, our EFC was $60k.

 

[MeowMix]

You get in touch with your school's financial aid office and find out how you file a "Reconsideration of Income" appeal for circumstances like these, in which your income changes radically from year to year. It exists, so keep pushing if they are not helpful or you get a staff member who doesn't know about it.

With kids, there is also a little-known category of "negative income" for which you may qualify.

The high EFC wipes out your eligibility for subsidized Stafford, but you still get unsubsidized.

 

[Doctor Bagel]

The high EFC wipes out your eligibility for subsidized Stafford, but you still get unsubsidized.

The good thing is that my cheapest school option would still require me to borrow about $36k. Since the difference between that and my efc of $22k is more than $8.5k, I can still get the full subsidized option. Honestly, I think we're all going to be able to get the subsidized staffords unless we have a combination of both a very cheap school and a very high efc.

 

[mshheaddoc]

You get in touch with your school's financial aid office and find out how you file a "Reconsideration of Income" appeal for circumstances like these, in which your income changes radically from year to year. It exists, so keep pushing if they are not helpful or you get a staff member who doesn't know about it.

With kids, there is also a little-known category of "negative income" for which you may qualify.

The high EFC wipes out your eligibility for subsidized Stafford, but you still get unsubsidized.

Yeah I did this with my post-bacc and it dropped like $12K. 👍 Because if you worked this year and next year you are in school, you don't have the same income.

 

[rgerwin]

I have a question. I have never made more than 32K a year,many student loans, no savings and my husband is a student and has virtually no income. Is there a good chance I will qualify for subsidized stafford?

 

[ShyRem]

Fill out your FAFSA and it'll tell you.

 

[mshheaddoc]

Fill out your FAFSA and it'll tell you.

well the FAFSA doesn't tell you perse, does it? I never noticed it. It just told you your EFC then financial aid office had to review then they told you how much you got.

 

[ShyRem]

not per se, msh. I think the EFC comes off the personal loan amount first, then subsidized stafford amounts next. But without rgerwin telling what their EFC is and the tuition/COA for their school, no one can make an intelligent answer to their question. If rgerwin's EFC comes out at $0 or something like that, then the question is moot. If their EFC comes out at $10K, then you need to look at COA.

I guess my terse answer was more geared towards a "throw me a freekin' bone here" or "gimme something to work with". Didn't mean for it to sound mean. 🙂

 

[CCEMTP2DOC]

I am really kinda confused re: EFC. I know that this is my portion. I am still able to get federal loans? I really can't afford to pay the EFC, not with 2 kids and a stay at home wife. What exactly will be my options for loans? I realize that I may not qualify for grants, but I thought federal loans were a different story. I would prefer not to do all private loans, as my income will be much less and you can defer federal loans. Please help shed some light on this. Thanks.


Rob

 

[Doctor Bagel]

I have a question. I have never made more than 32K a year,many student loans, no savings and my husband is a student and has virtually no income. Is there a good chance I will qualify for subsidized stafford?

I think you're virtually guaranteed to qualify for subsidized staffords. At one of my interviews, they said you basically had to make a ton of money or have a ton of money to not qualify for the subsidized staffords. The thing to consider is that cost of attendance at almost all non-public schools is going to be around $60k/year and around $40k/year at most public schools. So, unless your efc is $50k assuming you're going to a private school or $30k assuming you're going to a public school, you're probably going to have a need level of at least $8500, which is the maximum subsidized stafford amount per year. Even with my fairly big EFC, I know I'll be able to get the full subsidized staffords plus the full unsubsidized stafford amounts.

 

[cfdavid]

Hey guys, I have zero experience with financial aid.

I'm going to be filling out FAFSA in the next day or so. The question is will the fact that my 2005 W2's are significantly less than any year prior (for the past 5 years) hurt me, or help me??

I can see low income being good in that they see a need, but higher income being good too since they may feel you have a greater ability to pay back the loan. Which is it? FAFSA only asks for 2005 W2's, but in my case is hardly representative of my income history...

Any help?

 

[ShyRem]

cf, if you look poorer than the beggars on the street corner, you get max financial aid. The fact that you're going to medical school will look favorably in terms of paying back the loan. If your income is too high, it eats into your potential financial aid package. Don't worry about prior years - just do the past year. You have to file FAFSA every year.

 

[cfdavid]

cf, if you look poorer than the beggars on the street corner, you get max financial aid. The fact that you're going to medical school will look favorably in terms of paying back the loan. If your income is too high, it eats into your potential financial aid package. Don't worry about prior years - just do the past year. You have to file FAFSA every year.

Cool. Thanks for the info. "poorer than the beggers on the street corner" lol

 

[humuhumu]

How soon do you get the EFC after filling out the FAFSA?

 

[ShyRem]

I got mine immediately. It was on my confirmation page, I think. If you've filed it already and don't remember your EFC, log back in and look at the SAR page. That should tell you.

 

[scpod]

I'm going to be filling out FAFSA in the next day or so. The question is will the fact that my 2005 W2's are significantly less than any year prior (for the past 5 years) hurt me, or help me??
Any help?

Remember that the FAFSA goes one year at a time...so what you did last year normally determines what will happen next year. However, your med school knows that you won't be working at all when you matriculate. They'll be looking at you making ZERO dollars next year. If your wife makes $1,000,000.00+ per year you might be screwed, though. 😉

 

[tigress]

So I've filed my taxes, and I want to file my FAFSA tomorrow. But last night my father said he'll be able to get their info within the next few weeks. So now I'm not sure what to do. Should I file without it? I'm almost certain I'm not going to qualify for institutional aid, based on my parental info, but there's always the outside chance . . . Another factor is that I'm going to be applying to private scholarships and loan programs that require a copy of the FAFSA. Although my EFC will be close to non-existant, my parental info on there might sway the decision.

Any advice?

 

[scpod]

So I've filed my taxes, and I want to file my FAFSA tomorrow...Any advice?

File it now. You can always make corrections later.

 

[tigress]

File it now. You can always make corrections later.

Right. Well, the school won't consider it anyway without parental info, so there's no reason to file it early without that info. (The federal deadline is much later, like May, and no matter how late I file -- before the deadline, of course -- I'll get full consideration for federal loans. I know this from my husband's experience.) So what would be the point of filing it early just to file it? See what I mean? The whole point in filing early is to be considered for institutional aid.

I guess my main question is whether to bother with parental info at all. If I decide not to, I'll file tomorrow. If I decide I need to, I'll file in a few weeks. But I can't figure that out. I realize it's my decision and nobody knows what's best, but maybe people have some ideas. I think for non-trads with parents who have moderately high incomes/assets this is a hard decision to make. Especially if we want to apply for private loans and scholarships that might not request parental info otherwise.

 

[SheLioness]

The high EFC wipes out your eligibility for subsidized Stafford, but you still get unsubsidized.

My EFC was $20K. Are med students eligible for Stafford loans? 😕

 

[tigress]

Yes, med students can get Stafford loans. Subsidized up to $8500 a year, and then unsubsidized up to I forget how much. My husband has so far gotten by with just this federal loan money to pay for tuition and fees. At a private school you also have to take private loans to pay for cost of living, unless you have another source of money.

 

[Doctor Bagel]

The parent thing isn't very straight-forward. I included mine, and luckily my parents did their taxes early. However, based on my parents' 2005 income, I don't think it's going to do me any good. Next year, I'll be all over the parental income because my parents retired recently. I've got to say that if I had to wait a long time for the info, I wouldn't have included it.

 

[ShyRem]

The unsubsidized amount is $30K/yr, so you get a total stafford (unsub+sub) of $38.5K/yr. You can borrow up to the school's COA allowance via private loans (which I know next to nothing about, but I'll be learning shortly when I apply for them).

Parental income is generally not a factor for stafford or private loans, but rather for institutional aid. When filling out your FAFSA, you should have received a screen that told you whether or not you were deemed 'independent'. I *think* (read: not completely sure) that medical students are automatically considered independent for FAFSA. You can approximate FAFSA amounts for you and your parents and change it later. Filing early seems to be key since all the schools are saying to do it ASAP.

 

[cfdavid]

O.k. Finished my taxes and filed FAFSA. My EFC is estimated at $67,216

WTF?????????????????????????????

I submitted 2005 W2's etc. This was much less than previous years.
The only thing I can think of that would make the EFC seem so high is my 401K fund (I saved relatively well). But, how many people liquidate their IRA to go to med school?? I will if necessary, but come on.

(I rolled my 401K over into a traditional IRA recently, since I left my job in August (full-time that is)).

Obviously, I did not include parental data in my FAFSA, and I checked it for errors. Everything looks correct.

Is it a decent amount of money in my IRA that is screwing me up on this????
My reported income for 2005 was in the $40's and my "net worth" was very, very modest.

I'm getting very, very worried now. I'm on my own in this, as the vast majority of you guys are.

Anyone have any input????

 

[Doctor Bagel]

O.k. Finished my taxes and filed FAFSA. My EFC is estimated at $67,216

WTF?????????????????????????????

I submitted 2005 W2's etc. This was much less than previous years.
The only thing I can think of that would make the EFC seem so high is my 401K fund (I saved relatively well). But, how many people liquidate their IRA to go to med school?? I will if necessary, but come on.

(I rolled my 401K over into a traditional IRA recently, since I left my job in August (full-time that is)).

Obviously, I did not include parental data in my FAFSA, and I checked it for errors. Everything looks correct.

Is it a decent amount of money in my IRA that is screwing me up on this????
My reported income for 2005 was in the $40's and my "net worth" was very, very modest.

I'm getting very, very worried now. I'm on my own in this, as the vast majority of you guys are.

Anyone have any input????

That is super high. However, you don't have to report retirement savings. The FAFSA asks for investments other than 401ks, IRAs, etc. Go back and change that and I imagine your EFC will drop. 🙂

 

[dca_55]

The unsubsidized amount is $30K/yr, so you get a total stafford (unsub+sub) of $38.5K/yr. You can borrow up to the school's COA allowance via private loans (which I know next to nothing about, but I'll be learning shortly when I apply for them).

Parental income is generally not a factor for stafford or private loans, but rather for institutional aid. When filling out your FAFSA, you should have received a screen that told you whether or not you were deemed 'independent'. I *think* (read: not completely sure) that medical students are automatically considered independent for FAFSA. You can approximate FAFSA amounts for you and your parents and change it later. Filing early seems to be key since all the schools are saying to do it ASAP.

I wasn't even aware that parental income comes into play at all. My parents are both deceased, does that mean I'll get some aid from med school to help pay for costs? Do med schools normally expect parents to finance a portion of the costs? I assumed I would be taking out loans for 100% of the cost of attending.

 

[cfdavid]

That is super high. However, you don't have to report retirement savings. The FAFSA asks for investments other than 401ks, IRAs, etc. Go back and change that and I imagine your EFC will drop. 🙂

I sure hope so. I can't change now until it has been process(ed).

But, "Worksheet B" DOES ask for payments to tax-deferred pensions & savings. (i.e. what i automatically deposited into my 401k)

It also asks for Untaxed portions of "pensions".

We'll see. I'll also call them on Monday.

Thanks for the input. 👍

 

[.edu-MD]

O.k. Finished my taxes and filed FAFSA. My EFC is estimated at $67,216

WTF?????????????????????????????

👍 (Sorry). Now I don't feel so bad with my number. But yours does seem awfully high. Did you max out your 401k contribution last year? Even then, that EFC must be pretty close to or exceed your gross income if your AGI was $40s? Or did you perhaps have a lot of capital gains? I only contributed ~5k to my 403b with an AGI in the 40s as well. But I think they're including the spouse's income here (which was essentially the same, although with an IRA instead of a company-sponsored retirement plan).

Anyhow, to address exlawgrrl's comment, it seems to be only the filing year's retirement plan contributions that go on there. So any contributions made in previous years are safe.

I don't plan on dipping into my retirement savings for this. I'd be penalized in taking most of it out I think, because of that minimum number of years rule (at least for IRAs, not sure about the 401k/403b types).

 

[ShyRem]

The instructions do say that mandatory retirement is specifically excluded. also my parent's IRA was specifically excluded. Ah, yes. From the worksheet:

Investments do not include the home you live in; the value of life insurance, retirement plans (pension funds, annuities,
noneducation IRAs, Keogh plans, etc.), and prepaid tuition plans; or cash, savings, and checking accounts.

I see on the worksheet B part it asks for amounts paid into pensions and IRA. But I don't see anywhere else where I asks for the total the IRA is worth.

 

[rkl_OD2be]

O.k. Finished my taxes and filed FAFSA. My EFC is estimated at $67,216

WTF?????????????????????????????

I'll second your WTF??????? I just filled out my FAFSA, which included my parents information. My AGI was in the upper $70's, we have (as of the day I signed the FAFSA) ~$1100 cash/checking/savings, $0 (non-retirement) investments, with 4 exemptions (self + wife + 2 kids). My EFC came back at $16,723. This is the actual # from my actual SAR.

I'm going into Optometry, but I'm fairly certain the FAFSA treats all graduate level programs the same...

 

[Doctor Bagel]

I'll second your WTF??????? I just filled out my FAFSA, which included my parents information. My AGI was in the upper $70's, we have (as of the day I signed the FAFSA) ~$1100 cash/checking/savings, $0 (non-retirement) investments, with 4 exemptions (self + wife + 2 kids). My EFC came back at $16,723. This is the actual # from my actual SAR.

I'm going into Optometry, but I'm fairly certain the FAFSA treats all graduate level programs the same...

The problem with the EFC is that it doesn't account for your income loss when you start school. It's still ridiculous even without income loss, but with it, it becomes even more insane. Luckily, it doesn't seem like schools adhere to it that rigidly.

 

[rkl_OD2be]

But, "Worksheet B" DOES ask for payments to tax-deferred pensions & savings. (i.e. what i automatically deposited into my 401k)

"FAFSA Worksheet B -- Report Annual Amounts...Payments to tax-deferred pension and savings plans (paid directly or withheld from earnings), including but not limited to amounts reported on W-2 Form Boxes 12a - 12d, codes D,E,F,G,H and S."

I don't see them asking for the entire balance of your retirement investments, only what you paid (or had withheld) in 2005. (At least that's how I filled out mine...)

It also asks for Untaxed portions of "pensions".

"IRS Form 1040--lines (16a minus 16b)...Exclude rollovers..."

Again, I don't think this applies to you unless you have (16a minus 16b) > 0.00.

Hope this helps...

 

[cfdavid]

I don't see them asking for the entire balance of your retirement investments, only what you paid (or had withheld) in 2005. (At least that's how I filled out mine...)


"IRS Form 1040--lines (16a minus 16b)...Exclude rollovers..."

Again, I don't think this applies to you unless you have (16a minus 16b) > 0.00.

I think I may have missed the "Exlude rollovers" portion. Because, my 16a is the amount that I rolled over (from 401k to IRA). Of course my 16b is 0 since none of that rollover amount was taxable.

Thus, my 16a - 16b is a large amount (the full amount of my retirement savings). I think that's where I made the mistake. I did not see where it said "Exclude rollovers".
Thanks for pointing this out. Also, thanks for all the feedback from others.
I appreciate it.

 

[titoincali]

I'm so glad I found this thread because when I finished my FAFSA this morning I almost freaked out when I saw my EFC at $14,000. Considering I am quitting my job in 3 months, have only a retirement savings, and a mother who doesn't have a large income I've been worried all day about what my EFC would mean.

So it sounds like schools are willing to recalculate a bit considering the drastic loss of income, right?

 

[oldManDO2009]

MY EFC was some rediculous number - I still was able to barrow the max amount based on my school budget. I just have a greater portion of private loans. Pick you lender and apply early - they will wait for the school input for subsidized loans but will approve/decline your privat loans imediately. Once the school submitted the "loan package" to my lender everything weent vary smoothly. There are a lot od lenders so do a little research and pick you lender andfor most non-traditionals with families - parent income is not applicable.

 

[DentalNerd]

I found this worksheet that has a pretty good explanation of how to calculate your EFC. Most interesting part for me is the <$50k AGI. If you are independent and made less than $50k AGI, they don't look at your cash, savings, or net worth. I wonder if you even need to report it on your FAFSA? They will take 35% of your net worth, less Asset Protection Allowance, to calculate your EFC if you made over $50k AGI.

Anyway, hope it helps some of you calculate your EFC before submitting your FAFSA.

Has anyone received two EFC? With and without net assets included?

http://www.ifap.ed.gov/efcinformation/attachments/0607EFCFormulaGuideDecFinal.pdf

 

[.edu-MD]

If you are independent and made less than $50k AGI, they don't look at your cash, savings, or net worth. I wonder if you even need to report it on your FAFSA?

I think it's best to report everything and let them do the calculations. After all, you are confirming the accuracy of it all when you sign it and submit it.

Anyhow, this is a great find. Thanks for posting it. I see based on Table 4 that all of my assets are protected. So the ridiculous EFC they calculated was solely based on the combined incomes of the filer and spouse. There are no allowances for retirement plan contributions for that year because they are all added back. They factor in state income taxes but not city income taxes. And there's obviously no mechanism to take into account the reduced/null income of the filer when school begins.

 

[tigress]

Wow, I got lucky. I submitted last night (processed today!) and my EFC is only $1676. I'm glad that my year of working full-time is 6 months in one year and 6 months in another, and we got a huge deduction from my husband's tuition payments. I was very pleased to learn that tuition paid with loans still counts as a deduction 🙂

I submitted without parental info, and now I'm debating whether to go back and add it. I can't decide. My father is filing his taxes in the next few days, so the info is available. I guess it can't hurt, but I wonder if it will make a difference when I'm applying to private loans and scholarships that require a copy of the FAFSA. Any input?

 

[cfdavid]

Got my FAFSA down to 21k.

Thanks to the person(s) that caught my error of reporting my IRA rollover.

I appreciate it.

 

[soumdoc]

My EFC is $0 (which makes sense because both me and my husband are students and we basically live off of his PHD stipend (which is not much at all).......so what types of financial aid will I be offered? Will I be eligible for grants? What grants are available for med students?

 

[tigress]

soumdoc, it depends on the institution and your parental info. Some schools have great aid in the form of grants available, whereas others don't. Also, they will use your parental info on the FAFSA to determine if they are going to consider you for grants. Some schools have info on what's available on their websites, and I'm sure you could call the financial aid office to ask as well. Once you know where you're going, you can sit down with them and they will help you figure out how you will pay for school. Also at some point, usually in April I think, schools will send reward letters telling you how much aid money they've decided to give you.

As far as I know there aren't federal grants available for med students. I may be wrong, but I think that's the case. So for federal aid you'll be eligible for full loans, including subsidized and unsubsidized.

Hope that helps.

 

[beponychick]

The good thing is that my cheapest school option would still require me to borrow about $36k. Since the difference between that and my efc of $22k is more than $8.5k, I can still get the full subsidized option. Honestly, I think we're all going to be able to get the subsidized staffords unless we have a combination of both a very cheap school and a very high efc.

Can you explain how this works again please? My schools "budget" is around 43K, and my EFC came out to 15K. I was planning on borrowing the full 38500 in subsidized and unsubsidized loans. Do you still think I can get the subsidized portion? How do you calculate this?

Thanks so much.

 

[pico61]

How does filing a 1040 rather than a 1040ez affect financial aid? As I was filling out my fafsa it seemed that it would affect it but I could not figure out how. Does anyone know?

 

[tigress]

How does filing a 1040 rather than a 1040ez affect financial aid? As I was filling out my fafsa it seemed that it would affect it but I could not figure out how. Does anyone know?

I don't think it does. The FAFSA questions refer to specifc lines on the 1040, and they're different for 1040A/1040EZ and regular 1040. Other than that I don't see that it matters. Then again, I filed a 1040A, so maybe I'm just not aware of the difference.

 

[Doctor Bagel]

Can you explain how this works again please? My schools "budget" is around 43K, and my EFC came out to 15K. I was planning on borrowing the full 38500 in subsidized and unsubsidized loans. Do you still think I can get the subsidized portion? How do you calculate this?

Thanks so much.

Okay, here are the basics as I understand them. Assuming your school accepts your EFC as accurate, they'll subtract $15k from $43k to get your financial need. That would leave you with a need of $28k. To fill that need, they can give you $8500 in subsidized staffords, maybe some institutional aid and possibly a Perkins loans. After that you can borrow $30k in unsubsidized staffords and alternative loans up to the cost of attendance. Like private loans, unsubsidized staffords aren't need-based, so as long as your total aid package doesn't exceed the coa, you can take the full amount.

Does that make sense? I'm starting to hate this stuff. 🙂

Okay, Tigress got me wondering in the pre-allo thread. How many of you nontrads counted yourself as part of your parents' household? Somehow, I was able to enter that my parents had two people in their household (the two of them) and that no one was in college. Somebody noted that household members should include the student even if we're indenpendent and don't live in the household. Should I change it? What did the rest of you guys do?

editing to add that I went ahead and added myself to my parents' household. That's such a weird requirement.

 

[foodlover]

How does filing a 1040 rather than a 1040ez affect financial aid? As I was filling out my fafsa it seemed that it would affect it but I could not figure out how. Does anyone know?

If you have to file a 1040 (meaning you have capital gains, or itemize) then FAFSA calculates your savings/assets into your EFC. If you can file the 1040EZ (which is only possible if you don't have investments, but only regular savings accounts) then FAFSA doesn't calculate your savings into your EFC. I'm pretty sure that's correct.

In any case, it seems unfair to me. Say someone has tons of $$ saved in a regular savings account, but no mutual funds. That money won't get counted because of FAFSA's "simplified needs" formula. But if you have even a bit of money invested, they calcuate all your assets.

 

[pico61]

If you have to file a 1040 (meaning you have capital gains, or itemize) then FAFSA calculates your savings/assets into your EFC. If you can file the 1040EZ (which is only possible if you don't have investments, but only regular savings accounts) then FAFSA doesn't calculate your savings into your EFC. I'm pretty sure that's correct.

In any case, it seems unfair to me. Say someone has tons of $$ saved in a regular savings account, but no mutual funds. That money won't get counted because of FAFSA's "simplified needs" formula. But if you have even a bit of money invested, they calcuate all your assets.

Thanks. This is what I thought. This whole thing is weird. Oh well.