FAFSA - Where do we go from here?

As many students, parents, and educational administrators alike know, the rollout of the new 2024-2025 Free Application For Student Aid (FAFSA) has brought about an array of changes for those applying to college, including some concerning delays.

Notable Changes

In 2023, the U.S. Education Department made several changes to the FAFSA, including the especially notable replacement of the Expected Family Contribution (EFC) with the Student Aid Index (SAI), changing how financial need is determined. A student’s SAI can range from –1500 to 999999, and it is used to calculate how much and what type of aid a student can receive. 

Key Issues

Although the FAFSA changes were intended to improve the college application and financial aid process for students, their rollout came with issues such as glitches and technical errors. While the FAFSA was made available to most students by January 2024, many aid applicants were still faced with significant barriers. The Department of Education announced several issues that further exacerbated the troublesome rollout of the “new FAFSA”: 

• Many students from mixed-status families with parents who may not have a Social Security Number (SSN) were unable to submit a form online; several of these students were directed to fill out a paper FAFSA form, only to be told that the Department had (and still has) no timeline for processing paper FAFSA forms.
• In late January, the Department announced that they were unable to process submitted forms until March and that the ability to make corrections to a FAFSA would not be available until later in the summer. 
• In March 2024, the Department announced that there was a miscalculation with the SAI formula in some processed FAFSAs, requiring many forms to be reprocessed in April. 
• In August, the Department announced that a key functionality, an institution’s ability to make corrections to FAFSA submissions in batch through their student information system, would not be available for the 2024-2025 academic year, requiring institutions to manually correct any FAFSA submissions through the FAFSA Partner Portal.

Impact

The issues with FAFSA affected student financial aid application rates, as the National College Attainment Network (NCAN) reports that as of July, 12, only 47.2% of the high school class of 2024 has completed the FAFSA—a 10.9% decline from the previous year’s 54.2%. Even more concerning are the disparities between low-income student filer rate compared to their counterparts from families with higher incomes. This is especially significant because according to the NCAN, submitting a FAFSA is one of the best predictors of whether a senior will attend college. 

Many institutions of higher education have experienced decreases in either overall student populations and/or decreases in particular demographics. Enrollment professionals are left to wonder if these decreases can directly be attributed to the issues with the rollout of the FAFSA. Even more are asking if there are students who were unable to attend college because of the FAFSA issues, and if there is any chance of ever seeing them earn a degree of higher education.

Responses

In response to these issues, many states and schools delayed their filing deadlines in order to give students and families more time to fill out the FAFSA. Although the postponements allowed applicants more time with the FAFSA, they also created some very tight timelines for students relying on financial aid news to make their college decisions. Indeed, the U.S. Department of Education recently reported that some students did not even receive their final financial aid award letter until the end of August.

Institutions of higher education have been faced with increasing workloads, staff shortages, and limited resources during a time where they have also been asked to assist with increasing FAFSA filer rates. Despite the challenges, many institutions have developed creative outreach campaigns, workshops, websites, and more to assist students and families through the financial aid process.

Looking Forward

Currently, the FAFSA deadline for the 2024-2025 academic year is still June 30, 2025. It is imperative that students get the help and support that they need to submit the FAFSA by this deadline. There are still students and families who are working through the financial aid application process and deserve the opportunity to access financial aid to assist in their college journey. There are also still opportunities to learn valuable lessons from the 2024-2025 rollout to implement new strategies for the remainder of the year and beyond.

Recommendations

1. Connect with students and families who are still in the process. Identifying students who have not yet been awarded aid or are in the process of still attempting to enroll in college (mid-year transfers, deferred admissions, bridge program admits, etc.) and finding creative strategies to connect with them may prove beneficial to bolstering enrollment and retention rates, especially for institutions who have seen declines in enrollment demographics. One example is to look for opportunities to connect with needy students through the reallocation of unspent scholarship funds. Identifying scholarship opportunities that may have unspent funding that can be re-allocated specifically to students who are still trying to enroll in college may prove beneficial. AwardSpring’s platform makes the identification of eligible students for reallocation, awarding of funds, and communication of awards easy and seamless.
2. Communicate, communicate, communicate. One of the results of the FAFSA issues of 2024-2025 was the need for increased communication. Students and parents want information about schools’ scholarships and aid processes. Partners should look at the communication required to implement the changes for 2024-2025 and consider how to develop a robust communication plan for next year and beyond.
3. Be proactive. In 2024-2025, many higher education institutions were left with no other choice but to react to the many issues and delays from the FAFSA. As the Department of Education has announced that the 2025-2026 FAFSA will also be delayed until December 1st, institutions have an opportunity to be proactive moving into the next academic year. Institutions should consider proactive strategies to educate students and families on the FAFSA processes, develop campaign strategies to increase FAFSA filing rates, form partnerships with school counselors and scholarship organizations, adjust scholarship FAFSA requirements prior to application cycles opening, create communication plans, etc.

The 2024-2025 FAFSA cycle was indeed challenging. Challenges, however, often lead to growth and learning. As institutions begin to look forward to new aid cycles, the lessons learned during 2024-2025 will be invaluable to implement innovative strategies for meeting enrollment and retention goals.