EFC (expected family contribution) is the amount of money that a college student and her parents are expected to contribute to the student's college education. This number is used to calculate the financial aid packages of students. The higher the EFC of a student is, the more money he and his family are expected to contribute to his college education and the less financial aid he will receive. One way to receive more financial aid for college is to minimize EFC. The lower the EFC, the more money a student can receive in financial aid.
Instructions
1. Complete federal income tax forms as early as possible. The earlier that the student and parents complete their taxes, the earlier they will be able to fill out the FAFSA and have the student's EFC calculated.
2. Complete the FAFSA (Free Application for Federal Student Aid) early. By doing so the student will be able to to get as much financial aid as possible from the college that she chooses to attend. College financial aid is first-come, first-served. Waiting longer to fill out the FAFSA will decrease the likelihood of receiving as much financial aid as possible. The FAFSA can be filled out as early as the January preceding the start of the school year.
3. Make it the responsibility of the student to pay for college before the parent pays. Having the student use his money to pay for college expenses before their parent chips in lowers the expected family contribution number. Greater weight is given to the student's assets when the EFC is calculated, so having the student use up her resources first before the parents help pay for college costs will minimize EFC.
4. Put money in a 401k or IRA. Money that is in a 401k or IRA is excluded in calculating family EFC. Having more money in a 401k or IRA will minimize EFC by decreasing the amount of money and assets that are used to calculate how much the family should contribute to the student's education. Having less assets will minimize EFC.
5. Make major necessary purchases to lower assets. The more assets that a family has (i.e. money in bank accounts, stocks, equity, etc.) the higher the EFC for that family will be. Making a major purchase such as buying a car will lower a family's assets and minimize EFC.
Tags: more money, will minimize, amount money, assets that, college education, contribute student