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15 Financial Aid Myths You Can't Afford to Believe

A girl and her mom complete the FAFSA together on a laptop

There are a lot of misconceptions and myths surrounding financial aid and the FAFSA, and we understand why. It certainly can be confusing! Unfortunately, certain impressions can affect your ability to maximize the aid you're eligible for. That's why clearing up the rumors is so essential! Here are a few of the top financial aid myths you may have heard and why you shouldn't believe them.

Financial Aid Myths

Myth #1: Wealthy and middle-class students shouldn't bother filling out the FAFSA.
Everyone should fill out the FAFSA. Often, families aren't the best judges of their eligibility, and even families with higher-than-average incomes qualify for large amounts of financial aid, especially if they have several children simultaneously attending college. Also, keep in mind that if your family's financial situation changes, getting aid may be more challenging if you didn't initially submit the FAFSA.

Myth #2: It doesn't matter when I submit the FAFSA as long as I meet the deadline.
File the FAFSA as early as you can! Some states hand out money on a first-come, first-served basis. That means filing late means you could get less aid than someone who applied as soon as the application opened.

Myth #3: My family didn't qualify for financial aid last year, so we shouldn't bother filling out the FAFSA again.
Minor changes from year to year can drastically change the amount of aid you qualify for. For example, just because a family only qualified for loans last year doesn't mean they won't be awarded a different package this year. This is especially true if a family has more than one child in college. In short: Everyone should fill out the FAFSA every year, with no exceptions.

Myth #4: Scholarships are only for talented athletes or students with a 4.0 GPA.
There are scholarships out there for anyone – you don't necessarily need to be a math genius or a football star to qualify. Some organizations award scholarships based on ethnicity, unique talents, leadership abilities, volunteer work, or even physical characteristics like height! Many don't even take your grades into account! If you've filled out your profile, we'll be able to match you with scholarships to help you pay for school.

Myth #5: The FAFSA is too long and complicated to fill out.
The FAFSA initially seems intimidating, but that doesn't mean you shouldn't bother completing it. The first time you apply will take you the longest, but in subsequent years some of the fields that won't change (like your name, for example) will auto-populate, so you'll need to update the form. Remember, even if it takes time and effort, it's still worth doing.

Myth #6: I can't fill out FAFSA because my parents haven't filed their taxes yet.
For the 2016 year, you can complete the FAFSA without your parents' 2021 tax information. All you need to do is fill in estimates for income and tax information (you can use the previous year's tax returns for reference here). Then, you'll be able to correct your application after your parents have filed their taxes.

However, the FAFSA is changing, and the application will open in October rather than January. So, for example, if you're applying for aid for the 20232-2023 school year or later, you'll be able to apply starting in October 2022 with your family's 2021 tax returns.

Myth #7: The FAFSA only determines a student's eligibility for need-based grants.
Filing the FAFSA can qualify you for much more than need-based grants, which is another reason why everyone should fill out the application. In addition to need-based grants, you may be eligible for work-study programs or loans.

Myth #8: Scholarships are only available to students from families with lower than the typical median income.
Many scholarship applications don't take family income into account. Some will consider financial need, but others only ask about other qualifying factors. These could include academic history, volunteer work, ethnic background, intended major, community involvement, or a range of other qualifications.

Myth #9: Scholarships are only available to students from underrepresented groups.
While it's true some scholarships are for people with a particular ethnic background, that isn't true of many financial awards. Most applications probably won't ask about your heritage if it's not a scholarship specifically for minority students.

Myth #10: Our family/friends said we wouldn't qualify for financial aid, so we shouldn't waste our time applying.       

To answer this question, we talked to Marie D. Johnson, Director of Student Financial Services at the University of Vermont. Marie told us this is an unfortunate myth you can't afford to fall for.

Marie explained, "There is a lot of misinformation about financial aid eligibility, and some students and families automatically assume they won't qualify for financial aid. So they either don't complete the application or delay in doing so. While well-intentioned, advice from friends and family can be misleading and incomplete. It is advisable to complete the FAFSA to understand your eligibility and to access student/parent loans if needed.                                                                                                                                                                                                      

Myth #11: We saved too much and won't qualify for aid.
Saving money is always a good thing. While having more assets may decrease your eligibility for need-based aid, that doesn't mean you won't meet the aid requirements. The FAFSA won't even consider all assets (retirement plans, for instance). And there are some simple strategies you can take to maximize your likelihood of receiving financial aid. For this reason and many others, all families should fill out the FAFSA yearly because you never know what you'll qualify for.

Myth #12: The expected family contribution is the amount you pay, regardless of where you go to school.
The expected family contribution isn't how much you'll pay; it's actually the number used by your college to figure out how much federal aid you're eligible for. So don't let this number discourage you when you first see it. 

Myth #13: You can declare yourself an independent student to qualify for more aid.
You must meet specific criteria to qualify as an independent student – it's not just something you can choose to do in the hope of getting more aid. You can determine your dependency status for the FAFSA.

Myth #14: Home equity hurts your financial aid eligibility.
The net home equity on a family's primary residence isn't reported on the FAFSA. However, net home equity on investment properties or second homes is listed as an asset on the FAFSA. You can also read strategies for sheltering some of your assets on the FAFSA. 

Myth #15: We make too much money to qualify for financial aid.
You'd be surprised how much aid you may qualify for, even if your family is upper or middle class. So fill out the FAFSA even if you think your family's income is too high to qualify you for aid.

Myth #16: The FAFSA is only for loans, so why bother?
FAFSA packages differ and include work-study programs, grants, and student loans.

Get More Financial Aid Money for College

Now that we've settled those financial aid myths, we want to tell you how to find and save scholarships.

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