Navigating the upcoming 2024-25 academic year has been a challenge for families, at least when it comes to securing financial aid to help cover higher education costs.
Not only did a late rollout for the Free Application for Federal Student Aid (FAFSA) set families back when it came to applying for aid in a timely manner, but information wasn’t even released to schools until the first half of March. The U.S. Department of Education also announced in early April 2024 that as many as 30% of FAFSA forms are “potentially affected by known processing or data errors.”
Delays with the FAFSA aside, you still have time to submit the form if you haven’t already. In fact, the FAFSA deadline for the 2024-25 academic year isn’t until June 30, 2025, although many schools and states have much earlier deadlines when it comes to accessing aid.
However, you should know that submitting the FAFSA after school starts this year can cause significant problems when it comes to qualifying for aid.
With that in mind, when should you be finalizing paying for college? Let’s dive in.
Funding Timelines For The 2024–25 Academic Year
Even with all the challenges faced by families this year, by and large, there haven’t been any broad announcements in terms of paying for college later than usual. Higher ed consultant Danilo Umali of Game Theory College Planners says that colleges still want their money as usual, typically before fall matriculation.
“The only delays we’ve seen is an extension beyond the informal May 1st decision deadline,” he says.
Umali says that hasn’t stopped colleges from pressuring families into an attendance decision by forcing a deposit on housing before the typical May 1st deadline. Unfortunately, this makes zero sense for anyone still waiting on their complete financial aid packages from the colleges. Families shouldn’t have to put down a deposit for housing when they have no idea how much aid their dependent will receive, or what their own out-of-pocket responsibility for college expenses will be.
Wealth advisor and college financial aid advisor Jack Wang of Innovative Advisory Group says that, generally speaking, fall semester or first quarterly bills typically go out to families over the summer months of June or July. This means bills are set to arrive in homes in short order, potentially even before families know how much aid they’ll receive.
Wang says he typically counsels his clients not to pay the first bill without poring over the details since they are often incorrect.
“Aid may not show yet, or there may be other charges like student health insurance that need to be waived,” he said.
This is typically okay since college tuition bills aren’t usually due until August, right before school starts. However, you’ll want to read over the bill you’re sent to know the exact due date to avoid a late payment.
In the meantime, federal student loans open for the coming academic year in June. These loans are also “awarded” based on information submitted by families in the FAFSA form, so this is another area where many are still waiting to hear.
Umali also points out that, when it comes to private student loans, many lenders won’t approve applicants for financing without an award letter in hand. At that point, families can apply for private student loans to fill in funding gaps they have.
How To “Catch Up” For The 2024-25 Academic Year
Families who haven’t taken steps to figure out how to pay for college this year (or where to attend) still have some time, but not a lot.
First, Umali points out that you may want to consider more schools than you normally would if you or your dependent haven’t started applying for colleges yet. A range of colleges and universities have even extended their deadlines to apply for enrollment this year as well, many into June, July, or August.
“You may yet find some hidden gems here,” he says.
Beyond applying for schools, those planning to attend college this year desperately need to fill out the FAFSA as soon as they can. This is the only pathway to qualify for federal student loans as well as other types of aid, including Pell Grants, work-study programs, and more.
Wang also says families need to consider if they should borrow to help cover college costs, whether they opt for a loan that’s federal, private, or potentially even both. While federal student loans are best for college expenses since they come with access to protections like deferment and forbearance and income-driven repayment plans like the new Saving On a Valuable Education (SAVE) plan, private student loans may also be required.
Those who have money saved in a 529 college savings plan also need to understand how disbursements work. For example, it may be possible to send the money directly to a school to help cover tuition and fees, or parents can take disbursements directly and cover these costs from the proceeds.
The Bottom Line
FAFSA failures and processing errors have made getting funding lined up for college this year complicated and slow, and many families are still left wondering how much they’ll actually owe for the 2024-25 academic year when all is said and done.
According to Wang, the biggest losers in all of this are families who cannot afford to pay (or borrow) the ridiculous prices colleges are charging for tuition, fees, and room and board.
“The magnitude of failure from the Department of Education is unlike anything we’ve seen,” he said.
Wang also points out that some lesser known but fantastic colleges may also suffer due to these delays, mostly because their lower enrollment yields rely on competitive awards to fill their seats.
“Without the financial data provided by the FAFSA, these colleges may fail to fill the seats they need to generate the revenue they need to survive.”
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