Avoid These FAFSA Mistakes
(Free Application for Federal Student Aid)
The FAFSA application is important for both need-based and merit aid. Avoid these FAFSA mistakes that can cost you college money.
1: Not completing the FAFSA
Even if you don’t think you’ll qualify for need-based aid, some merit-based scholarships require a FAFSA. Federal student loans require a FAFSA. According to a 2023 Sallie Mae survey, 30% of eligible students left money behind because they didn’t fill out the FAFSA. More than $3.75 billion in potential aid to an estimated 813,000 college students went unawarded in 2021.
And here are even more reasons why you don’t want to make this mistake.
2: Missing a deadline
The FAFSA application opens October 1 of each year (December 31 for 2023 due to changes in the form) for the following academic year (2024-25) and closes June 30 (2024). However, many states, colleges, and scholarship programs have fall or winter deadlines and/or limited funds.
So, complete your FAFSA early, and as soon as possible after October 1 (December for 2023). Here’s a guide to help you.
3: Not getting (or keeping) your FSA ID
Before you begin the FAFSA, you’ll need to register for an FSA ID. If you’re a dependent student, your parent/guardian will also need their own FSA ID. You’ll need your Social Security number to create an FSA ID. Here are other documents you’ll also need for the FAFSA.
You cannot share an FSA ID, and the process can take up to three days. Create an FSA ID
To begin the FAFSA, indicate whether you are a student, parent/guardian, or other preparer, then enter your FSA ID. This will pre-fill information and speed up the process. If you need to make corrections or updates, you’ll need your FSA ID. And you’ll use the same FSA ID every year.
4: Using incorrect personal information
Use your legal name, not a nickname. Your FAFSA application name should match your social security card. Mismatches can mean a delay or denial of financial aid.
Double-check your social security number is entered correctly. For students (or parents) without a social security number, the Department of Education advises using 000-00-0000. Do not make up a number or use a Taxpayer Identification Number.
Use your permanent mailing address, not a school or temporary address. Provide an email address you check regularly. If a financial aid office has questions, you’ll want to respond quickly to keep your application on track.
5: Including incorrect parent information
Include parent marital status on the day the FAFSA is signed. FAFSA guidelines are not the same as IRS guidelines. for dependency status. Use this FAFSA guide to help if you’re unsure.
- If your custodial parent has remarried, you must include the stepparent information as well.
- If your parents are not married but live together, you must list both parents on the FAFSA.
- If your parents are divorced or separated, and don’t live together, answer questions for the parent you lived with the most in the past year. If equal, include information for the parent who provided more financial support.
6: Confusing student and parent information
Parents often complete the FAFSA to retain privacy of financial information, ease the burden on a busy student, or for other reasons. For the FAFSA, “your” refers to the student. When parent information is required, the form refers to “your parent/s.”
The FAFSA asks how many household members will attend college. Don’t forget to include yourself if you are completing the form as a student. Parents should not be included in the count even if they are attending college, but this information should be shared with college financial aid offices.
7: Not including schools on your list
Unless you already know where you’re going to college, add ALL the colleges from your list to the FAFSA. You can include up to 10 schools on the online FAFSA and four schools on the paper version. To change or add schools to the FAFSA, login and select Make FAFSA Corrections, remove an existing school/s and add a new one or more. Any schools you remove will not automatically receive any new information you provide. Removing and adding more schools will not hurt your application. Alternatively, you can mail in the paper version of your Student Aid Report (SAR) with four changes at a time.
IMPORTANT: In some states, the order of schools you list may matter. Check this list for your state’s requirements.
8: Not using the IRS Data Retrieval Tool
The IRS Data Retrieval Tool can prevent multiple errors. If you choose to enter financial information manually, read the instructions and definitions carefully. Not all answers can transfer from the IRS, so you’ll have some Additional Financial Information questions to enter yourself. Some of these answers may be found on your W-2.
Adjusted Gross Income (AGI) and Income Tax Paid are not the amounts shown on your W-2. Use your parents’ (or your) tax return instead, or the IRS Data Retrieval Tool to prevent over or understating amounts.
Net worth of investments. Do NOT include retirement accounts, the home you live in, or small business assets. Do NOT double report assets in both the student and parent sections. A 529 account with a student as beneficiary should be listed as a parent’s asset, or not at all, if a grandparent’s asset. Here’s a FAFSA guide to determine what to include for net worth of investments.
Taxable college grants and scholarships. Do NOT report 1098-T scholarship and grant amounts for taxable college grants and scholarships; include only those reported to the IRS as income. If you didn’t file taxes, enter “0” for this question.
9: Leaving FAFSA fields blank
Using the IRS Data Retrieval Tool, and the Renew Your FAFSA option (after the first year), can prevent unintentional blank fields among the 100+ questions. Instead, enter “0” or “not applicable” if needed. Too many bank fields can cause errors or rejection of the form.
10: Using the wrong tax year information
The FAFSA uses information from two years prior (2022) for the next (2024-25) academic year. Providing the wrong data can cause your FAFSA to be rejected. Changes in financial situations (job loss, significantly reduced income) can be reported directly to college financial aid offices. Experts advise using the IRS Data Retrieval Tool to automatically transfer tax information to the FAFSA. This can significantly reduce errors, and minimize the possibility of being selected for verification which delays FAFSA processing.
11: Forgetting to sign your application
If you complete the FAFSA online (easiest), you’ll need your FSA ID and password. Many students/parents answer all the questions, then forget to sign and submit, often because of a forgotten FSA ID or student/parent not immediately present.
If necessary, you can choose to print the signature page and submit the FAFSA by mail. The online FAFSA is processed within 3-5 business days while the paper version takes 10 days plus mail time. Submitting the FAFSA online allows you to immediately check your status.
12: Not reviewing your Student Aid Report (SAR)
Within a few weeks after submitting your FAFSA, you’ll receive your SAR. Look closely for mistakes and make corrections if needed.
13: Not renewing your FAFSA every year
For each year you’ll be in college, you’ll need to renew your FAFSA to be eligible for Pell Grants, Federal Supplemental Educational Opportunity Grants (FSEOG), and federal work-study and student loans. If you keep your FSA ID, renewal will be much easier.