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FAFSA EFC - Understanding the Expected Family Contribution (EFC)

What's Your EFC and Why Does It Matter?


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If there’s a number at the heart of the financial aid process, it’s the Expected Family Contribution or EFC. Ultimately, the lower this number, the more financial aid you’re likely to receive.

Confusingly enough, the EFC on your FAFSA form doesn’t necessarily equal what you’ll be expected to pay. Most families pay something more or less than their EFC, depending on the availability of financial aid at their school.

While the EFC seems mysterious, it is based on a preset formula that, in the case of Federal financial aid, is set by law. The EFC formula takes into account:

  • Income
  • Assets
  • Employment benefits
  • Family size
  • Number of family members in college

Once you complete your FAFSA form, a Student Aid Report (SAR) is generated and sent to both you and the schools that you indicate on your form. Each school’s financial aid office then subtracts your expected family contribution from their school’s unique cost of attendance (COA), resulting in your financial need for that school.

Since there are so many variables involved in computing your unique expected family contribution, it’s hard to give rules of thumb about what someone’s EFC will be based on a single factor such as income or assets. The Department of Education does provide an online estimation tool called the FAFSA4caster to help families estimate their EFC.

Before you start thinking about telling a few white lies on your FAFSA to lower your expected family contribution, it’s important to realize that the penalties if caught can include stiff fines and jail time.

The easiest way to cut your expected family contribution is to be declared an independent student, though this requires meeting certain criteria. By removing a parent’s income and assets, it could substantially decrease the EFC and qualify you for more financial aid.

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