It's Time to Streamline the FAFSA

September 20, 2016

Carrie Warick, Director of Policy and Advocacy

Updated 10.12.16 - For the most up to date version of this proposal and additional details, please visit www.collegeaccess.org/fixfafsa.

Five years ago, NCAN dove into federal financial aid policy and one of our initial recommendations was to simplify the aid application process. Last fall, the first big step forward happened when the Obama Administration announced that the Free Application for Federal Student Aid, or the FAFSA, would use income data from two years prior (rather than one) and it would be released in October instead of January, giving students three extra months to complete the form. But the move to Early FAFSA, as it’s now called, is only the beginning in streamlining the process of applying for financial aid from beginning to end.

Over the past year, NCAN has gathered more than 70 organizations, met with a dozen experts, talked with Congressional staff and listened to our members. After these many conversations, NCAN set three goals to guide our proposal for a better financial aid application process:

  • Stop asking poor students to prove they are poor over and over again.
  • Improve the user experience when filing the FAFSA.
  • Remove questions not needed for the federal formula and those answered by the fewest number of people.

Next, we tackled the FAFSA form itself. Making changes to such a crucial tool in the financial aid of millions of students should not be taken lightly. For this reason, NCAN knew that a research report or a few graphics would not be enough to improve this lynchpin in the college going process. To create a comprehensive, tested proposal to #FixFAFSA, we first hammered out, question by question, a Streamlined FAFSA methodology represented by the list of questions below. Second, we created a prototype online FAFSA to test with students. Students around the country are participating in a control- and test-group designed experiment to compare the current FAFSA with our prototype Streamlined FAFSA. In January, NCAN will release our final proposed Streamlined FAFSA along with our reasoning for its design, which will be informed by the user-testing experience, feedback from the field and a cost analysis.

So what questions does the Streamlined FAFSA include?

This overhaul of the FAFSA will give a different experience to users depending on their financial situation. For those receiving support from a means-tested benefit program already included on the FAFSA (with exception of free- and reduced-priced lunch), their families will automatically receive a full Pell Grant without having to answer any financial questions. These students and families will answer a total of 36-51 questions, 16 of which will be auto-filled from their FSA ID.

Pathway One:

Pathway Two:

Families who file taxes, but do not use schedules, will all be directed to the IRS Data Retrieval Tool (IRS DRT) and then will answer a handful of additional financial questions. Those on this pathway will answer a total of 47-67 questions, 24 of which will be auto-filled from either their FSA ID or the IRS DRT.

Path Three:

Finally, families who file tax schedules will have just two additional questions triggered in their FAFSA, addressing assets from real estate, family businesses and/or farms. These families will answer a total of 49-69 questions, 24 of which will be auto-filled from either their FSA ID or the IRS DRT.

State Page:

Finally, NCAN recommends moving eight questions (included in the ranges above) to a final “state page.” This state page will be optional at the choice of the state grant aid agency because the questions on this page are only used to distribute state-based financial aid. For states that do not use these questions, they can opt out and ensure that their students are on the lower end of the ranges listed above. Further, because none of these questions are financial in nature, institutions who may wish to know the information will be easily able to add them to other forms such as admissions.

Using this approach, low-income students will answer fewer than the questions of the current FAFSA, and it reduces the form for everyone by over one-third. This streamlined FAFSA, along with improvements to the FSA ID and the verification process, will work together to improve the overall financial aid application process so that the ability to access financial aid will not be a barrier to higher education success. Let us know what you think of our Streamlined FAFSA, and stay tuned for our final proposal in January.


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