February 20, 2007

Removing the FAFSA fear for low-income families

Posted in FAFSA, Student Loan News, The Financial Aid Process at 9:50 AM by Joe From Boston

A novel approach to financial aid – have H & R Block fill out your FAFSA! Inside Higher Ed is reporting a novel experiment currently underway in the Cleveland area; random families who use H & R Block services will be offered free FAFSA filing services along with their tax preparation.

That low-income Americans are far less likely to go to college than their peers are is a fact; less clear are the reasons why. But one oft-cited explanation is that potential college students from lower socioeconomic groups are either unaware of how much need-based financial aid is available or intimidated by the process of applying for federal student aid.

In a memorable stunt at a news conference in September where she discussed the need to simplify that process, Education Secretary Margaret Spellings unfavorably compared the length and complexity of the Free Application for Federal Student Aid (FAFSA) to the standard federal tax form, and the American Council on Education and the Lumina Foundation for Education have begun an aggressive public service campaign aimed, in part, at lowering low-income students’ fear factor in applying for federal aid.

“We have all this financial aid, but it doesn’t seem to be reaching the people who need it most,” says Bridget Terry Long, an associate professor of education and economics at Harvard University, who has written widely about college access. “A lot of people just don’t understand how the system works. And there are lots of calls for simplication, but what does that really mean?”

Long and some fellow researchers are taking an unconventional approach to the problem. The experiment, which is aimed at lower-income people who have teenage or college-age children or are potential college students themselves, seeks to gauge whether making it easier for low- and moderate-income families to apply for financial aid improves their college-going rates. What is unusual, however, is the research design — offering taxpayers a painless way to turn the information on their tax forms into a financial aid application — and the sponsor: H&R Block, the tax preparation company.

Here’s how the project, which involves researchers at Case Western Reserve University and University of Toronto in addition to Long, works: Randomly selected taxpayers with incomes below $45,000 who seek help from their taxes from H&R Block offices in and around Cleveland, Ohio, will be offered help filling out their FAFSA forms (a control group will receive only a brochure with publicly available information about attending and paying for college).

H&R Block’s tax preparers, working with software the company and the researchers jointly created, will help transport the applicants’ tax information into the federal financial aid form (more than half of the FAFSA information comes from the tax form), and help them collect the information for, and complete, the rest of the form. The hypothesis is that using tax data to automatically fill in a large number of answers to the 108 questions on the financial aid form, and offering personal help in filling out the rest, will make the FAFSA less daunting than it might otherwise be.

Next, company representatives, trained by the researchers, will give study participants projections of how much state and federal financial aid they may qualify for, and how far that would go in covering the cost of attending selected colleges in the area. “When we finish that interview, we give them a piece of paper that says, based on the information we’ve gathered today, here’s the tuition and here’s the aid you’d be eligible for,” says Eric P. Bettinger, associate professor of economics at Case Western…

Doug Lederman

Read the rest of the article here.


  1. Joe Radcliffe said,

    Last year we grossed $49000, but my daughter’s college asked us to fill our a Parent Low Income Clarification Worksheet. Is our income considered “unusually low”? We listed three dependents.


  2. Mike – the Expected Family Contribution (EFC) takes into account a lot more than just mortgage and adjusted gross income. If you want an estimate of how much your family would be expected to pay, please visit the EFC calculation tool from the Department of Education: http://www.fsa.ed.gov/fafsa4caster.html

    As for how much financial aid you’ll likely get, it varies greatly by school. A larger, private school with more money in the bank has more aid to give, whereas a public school has less to give but costs less to begin with.

    Regardless, the maximum need-based aid you will likely receive is the total cost of education (tuition, room, board and fees) minus your EFC. Merit-based aid is different and will depend on your grades.

    Also, don’t forget scholarships!!! Google around a bit- there’s so much money out there.

  3. Mike Buzzotta said,

    My parent’s adjusted gross income is $68,675.
    Their assets are limited to our home which we have a 350k+/- mortgage.
    What is available to me for assistance?

  4. In order for a student to qualify for federal sources of financial aid he/she must fill a FAFSA (Free Application for Federal Student Aid) form which in turn gives a feedback of student aid report about what his/her family is expected to contribute towards the student’s education.

    Edited by administrator to remove advertisement

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