Filling out the Free Application for Federal Student Aid (FAFSA) is still required for graduate school as it remains the nation’s largest source of student financial assistance. However, students are required to complete the FAFSA form to qualify for federal aid and grants. Let’s walk you through the details!
FAFSA for Graduate School
The Free Application for Federal Student Aid is a straightforward document one fills out to get financial aid from the federal government to help pay for college.
It’s a must if you desire any federal assistance whatsoever for higher education. It’s also used by many educational institutions to decide how much financial aid of their own they’ll hand out.
In general, to be qualified for this kind of federal aid, you need to be a U.S. citizen (or an eligible non-citizen), enrolled in an eligible degree at an accredited university, and demonstrate financial need, according to the Federal Student Aid website.
On the form, which is free to file, you’ll provide information about your personal finances to help the government make its decision.
And while you may think you don’t qualify, you or your household do not have to be low-income in order to acquire assistance.
There is no revenue cut-off, and many factors, including family size and program length, are taken into consideration. Plus, multiple work-study programs and scholarships actually require you to file a FAFSA application to even be considered.
In total, over 13 million students who file the FAFSA get more than 100 billion dollars in financial aid from the U.S. Department of Education, according to the College Board.
Nevertheless, there are still millions of dollars that are “left on the table by students who didn’t file a FAFSA,” the site reported. So, ensure to take advantage.
Filling out FAFSA Form: The Big Difference for Grad Students
One major difference as a graduate student is that you’ll file the FAFSA as an independent student. An independent student is at least one of the following:
- At least 24 years old
- A graduate or professional student
- A veteran
- A member of the armed forces
- An orphan
- A ward of the court
- Someone with legal dependents other than a spouse or your own children
- An emancipated minor
- Someone who is homeless or at risk of becoming homeless
As an independent student, you won’t be required to provide your parent’s information as you did when you were a dependent (undergraduate) student.
This is a general rule, so there are a few exceptions. Your program will notify you if you need to provide parental information.
When you complete the FAFSA as an independent student in graduate school, Federal Student Aid will use the financial information provided to see which loans and grants you’re eligible for.
Loans Available to Grad Students after Filing FAFSA Form
Graduate and professional students have two options for federal student loans. You can receive both Direct Unsubsidized student loans and Direct PLUS Loans.
Direct Unsubsidized Student Loans
Direct Unsubsidized student loans were available during your undergraduate program as well, so you may have already seen these — or taken out a few. The interest rate is higher on Direct Unsubsidized student loans for graduate students at **6.08%.
Direct Unsubsidized student loans collect interest during deferment and grace periods.
This interest, if unpaid, is added to the principal balance of your loan once you enter repayment. It’s called capitalized interest, which you’ll want to avoid if at all possible.
You have an annual limit to how much you can borrow with Direct Unsubsidized Loans. The total you can borrow annually is $20,500.
However, there’s also an aggregate (total overall) limit to how much you can borrow, which is $138,500 for graduate and professional students.
This total includes any Direct Unsubsidized and Subsidized Loans you took out during your undergrad. No more than $65,500 of this can be subsidized student loans from your undergrad.
Because of this limit, you may need to take out Direct PLUS Loans to complete your program.
Direct PLUS Loans
Direct PLUS Loans, also called Grad PLUS Loans, are available to help fill the gap after you’ve taken out the Direct Unsubsidized Loans. This is because they carry a high-interest rate and require an additional application.
Grad PLUS Loans have a fixed interest rate of **7.08%. You can use a Grad PLUS Loan to fund the rest of your educational needs as there’s no limit. Instead, there’s a formula.
A Grad PLUS Loan will cover the cost of attendance minus any other financial aid you received. The cost of attendance, which is determined by the school, can include things like housing and materials.
Again, you must complete an additional application for a Direct PLUS Loan after you file the FAFSA and receive your award letter.
This is typically filled out on StudentLoans.gov, but sometimes your school will have its own application. Check with your financial aid office before applying. Each of these student loans can be important to help fund your education.
However, keep in mind that your school will also use the information provided on the FAFSA to check for grant eligibility or award scholarships within the school, so it’s essential to file the FAFSA on time.
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6 Steps to Submit a FAFSA as a Graduate Student
The FAFSA typically opens October 1 the year prior to the start of your graduate school program. For example, if you plan to begin graduate school in the fall of 2021, you’ll file your FAFSA as early as Oct. 1, 2020.
The FAFSA typically closes June 30 (in this example, it would be June 30, 2021). However, most schools have an earlier deadline for FAFSA completion.
To file the FAFSA, you’ll need to complete the following steps:
1. Create or find your FSA ID. You probably created one of these during your undergrad. If so, you can use the same ID.
2. Log into the FAFSA website and complete the online application. You’ll need to have your:
- Drivers license number
- Social Security number
- Federal income tax returns, W-2s, and any records of money earned
- Bank statements and records of investments (if applicable)
- Records of untaxed income (if applicable)
Be sure to choose the correct year when completing the FAFSA.
3. Complete the student demographic section.
Fill in the required fields with information about yourself, such as your Social Security number, contact information, and details about your citizenship and level of education.
If you’ve filled out the FAFSA before, these fields might already be completed. In that case, just double-check to make sure everything is up to date.
4. Input your graduate program schools. At the end of the FAFSA, you’ll put the name of the school you plan on attending. If you applied to multiple schools, then you should list all of the ones you’re considering.
5. Input your income. You can use the IRS data retrieval tool offered in the form.
6. Sign and submit your FAFSA.
After submitting, you’ll first receive a Student Aid Report. This has a summary of all information provided on the FAFSA and the estimated number you’re expected to contribute to your education.
From here, you’ll wait to get an award letter from your graduate program outlining the student aid you’re eligible for. Don’t forget that you must file the FAFSA every year of your graduate program to stay eligible for funding.
Alternative Financial Options
Not all is lost if your award letter is a lower number than you expected. Ideally, you can supplement with scholarships, but this isn’t always enough.
If that’s the case, you can first try to negotiate your financial aid, and second, you can look into private student loans. Let’s walk you through it!
Negotiate Your Financial Aid
Negotiating your financial aid might not sound like a possibility, but it totally is. You can appeal for additional financial assistance.
Begin by contacting your financial aid office. Have a good attitude and be honest about the situation you’re in. Ask how you can make this work and then file an appeal.
You can also see if you can apply for any other scholarships or work-study is available to add on. More often than not, the financial aid office will want to help make it possible for you to attend.
Shop Around for a Private Student Loan
As a grad student, if your two loan options don’t cover everything and negotiating doesn’t work, you can look into private student loans.
Even when considering taking out a Direct PLUS Loan, you’ll want to compare it to private student loans since the interest rate is so high.
Private student loans are available through banks, credit unions, and various financial institutions. They have nothing to do with your FAFSA. You’ll complete a separate application with whatever lender you choose.
Be sure to shop around for the best grad school loans. In this case, you get to pick your lender and look at loan terms, so you should be picky. If you have good credit, you’ll probably get a lower rate, too.
Start your search with Credible to look at multiple lenders at once. You can also go individually to each site and get a quote. A “preapproval” doesn’t affect your credit score, as it’s a soft credit pull.
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Graduate school is a considerable investment, but you shouldn’t let that deter you from achieving this primary goal.
Filling out the FAFSA is the first step to making your master’s degree aspirations a reality, and you might be surprised by what financial aid options you’re eligible for.
Still, if you’re dissatisfied with what you’re awarded by the government, keep in mind that it’s not the end of the road. If you have good credit, there are other private loan companies you can turn to, for example.
Plenty of people also prefer to keep working as they attend graduate school in order to mitigate costs — online classes make this an easier option than ever, as does picking a part-time program so you can successfully juggle both work and school at the same time.
There are numerous ways to make graduate school an affordable achievement. And once you’ve earned your master’s degree and see how it impacts your career path, it will certainly feel well worth it.