Where and how to apply for FAFSA

More than $120 billion in federal college aid is up for grabs. Here’s how to get your portion. (iStock)

The price of a college degree depends on who’s calculating it. According to The College Board’s Trends in College Pricing 2019 report, the median in-state tuition and fees for the 2019-2020 academic year at a public four-year college was $10,440, compared to the average tuition and fees at a private four-year college of $49,870.

Based on U.S. News & World Report data, though, tuition and fees at an in-state public college was about $10,116 for the 2019-2020 school year, while the average sticker price for a private college was $36,801.

The consensus? College is expensive—and, unfortunately, family savings and income alone don’t cover the costs for most students today. More than eight in 10 families use scholarships and grants, and more than half of families borrow money to cover college costs, Sallie Mae’s How America Pays for College 2019 study found.


The good news? The U.S. Department of Education awards more than $120 billion a year in grants, work-study funds, low-interest loans, and other federal student aid to approximately 13 million students.

Here’s what you need to know about how to apply for it, who is eligible, how to explore your options.and why financial aid is so important.

How to apply for financial aid (FAFSA)

The first step to applying for financial aid should be getting familiar with the Free Application for Federal Student Aid (FAFSA). Through FAFSA, you can find out if you’re eligible to receive federal student loans, federal grants that don’t have to be repaid, or money through work-study programs. Three in four families (77 percent) completed the FAFSA last year, Sallie Mae found.


You'll have to meet certain eligibility requirements to qualify for federal financial aid, including the following:

  • High-school education: You must provide a high-school diploma, a GED certificate, or have completed homeschooling.
  • Citizenship: You must be a U.S. citizen, a U.S. national, or an eligible non-citizen and have a valid social security number.
  • Academics: You must be enrolled in an eligible program as a regular student seeking a degree or certificate.

Here’s how to submit a FAFSA application:

  • Gather documents such as your social security number, driver’s license or state ID, (alien registration number for non-U.S. citizens). parents' income if you’re a dependent, or proof of your income, such as recent W2s.
  • Go to the FAFSA website to create an account by using your email address and choosing a username and password. This will give you a Federal Student Aid (FSA) identification number.
  • Complete the financial section and information requested for the student and the parent.
  • Provide you and your parents’ financial information. To make it easier, eligible students and parents can automatically transfer their tax information into the FAFSA form by using the IRS’ data retrieval tool (DRT). (If you have trouble, you can download your tax transcript here).
  • In the school selection section, list the colleges you plan on applying to so that they receive your FAFSA information.

Is there any other financial aid besides FAFSA?

Outside of FAFSA, CareerOneStop.org is a great resource for finding scholarships, fellowships, grants, and other financial aid award opportunities—the website provides a list of more than 8,000 programs.

Moreover, check with your prospective colleges to see if they offer income-share agreements (ISAs). In a nutshell, an ISA is a contract where you agree to receive education funding from the school in exchange for sharing a percentage of your income after you graduate for a fixed number of years. Eligibility requirements vary by institution.

Why is financial aid important?

According to the Sallie Mae study, the top ways families said they were planning to pay for college included saving for college (64 percent), researching college costs and financial aid (40 percent), and actively budgeting an allocation of savings, borrowing, and potential aid resources (36 percent).


Nonetheless, about one-third of adults (34 percent) under age 30 have student loan debt, a recent Pew Research Center study found. And, a 2019 Payscale survey found that obtaining student loans was the biggest regret among college graduates. But qualifying for financial aid can help reduce your college costs.

Another reason financial aid is important? Shouldering big student loan payments after you graduate from college could make it difficult for you to pay rent, save for retirement or buy a house. Case in point: a 2018 Student Loan Hero survey found 40 percent of U.S. graduates with student loans said their student debt kept them from saving for a down payment to buy a home.

The morale: maximizing your federal aid can make achieving your financial goals a lot easier.