FAFSA stands for Free Application for Federal Student Aid. It is the single most important financial aid form a college student can complete — and it's free to file. Here's exactly how it works, step by step.
What FAFSA Determines
When you complete the FAFSA, the federal government calculates your Student Aid Index (SAI) — formerly called Expected Family Contribution (EFC). This number represents how much your family is expected to contribute toward your education. Colleges then subtract your SAI from their cost of attendance to determine your "financial need," which drives your aid package.
When to File
FAFSA opens on October 1 for the following academic year. For the 2025–2026 school year, FAFSA opened October 1, 2024. Filing as early as possible matters because some state and institutional grants are awarded on a first-come, first-served basis — once that money is gone, it's gone.
What Information You Need
You'll need your Social Security number, federal tax returns (using prior-prior year — so 2023 taxes for 2025–2026 aid), bank account balances, investment records, and your FSA ID (a username/password created at studentaid.gov). Dependent students also need their parents' financial information.
How Aid Is Calculated
After you submit, each college on your list receives your SAI and builds a financial aid package that may include: federal grants (Pell Grant, FSEOG), subsidized and unsubsidized loans, work-study opportunities, and institutional grants. The combination varies by school — which is why comparing aid packages across schools is essential.
Common FAFSA Mistakes to Avoid
Filing late is the most costly mistake. Others include: entering assets incorrectly, failing to list all colleges you're considering, and not re-filing each year (FAFSA must be renewed annually). Many students assume they won't qualify and skip filing — this is a mistake, since even students from higher-income families may qualify for unsubsidized loans and merit aid that requires FAFSA submission.