NCFS College Planning Center
EFC – Expected Family Contribution | Print |
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"We understand that most people are enrollment-impaired when it comes to addressing their children's college cost."


The first thing you need to do during the spring of your senior year is to fill out a Financial Aid Form (FAFSA). The FAFSA establishes your family's "need" and thus determines what free money (grants) or subsidized loans you qualify for.

In determining if a student has a "financial need," a financial aid administrator will:

  1. Check the cost of an education at the school you plan to attend.
  2. Subtract the amount you and your family are expected to pay towards that cost. 

A Family’s Contribution and Related Factors 

The family’s contribution is a combination of what parents and the student will be expected to contribute toward a college education. The parents’ contribution is based on the number of family members in college and allows for living expenses. This allowance is conservative and reflects a minimum budget for any family. As a result, it is rare to find a family that can meet its expected contribution from current income. Most families meet this expense through a combination of savings, current income, and loans.  One common misconception is that having savings or assets will automatically exclude a family from financial aid. Many parents assume that aid won’t be offered until all savings and assets have been exhausted. This is simply not true.  Some parents assume that owning a home or having significant savings makes them ineligible. Having home equity and money in the bank does not mean that students will not qualify for assistance. In fact, home equity isn’t even considered by some colleges in determining eligibility.  Income is actually the major factor in establishing a family’s contribution. Assets and savings are also considered, but no more than 6 percent of parents’ assets are included in any given year. Parents should be honest about their ages, since the 6 percent assessment would be lower for older parents who are closer to retirement.  The total cost includes tuition and fees as well as other associated expenses, such as the cost of books or other supplies. If a student plans to live on campus, room and board will be considered and allowance made for traveling home at least once during the school year. If the student will be commuting, transportation is included. In other words, the amount is the total cost of attending college for one year. Check out College Costs for more information about educational and living expenses at college.

Students should explore every college that interests them on the assumption that they will receive financial aid if they need it. But they should keep in mind that while the college’s financial aid office will attempt to meet the total “need for assistance,” there’s no guarantee that they will be able to do so. Some colleges can provide assistance to meet the full need of each student. These schools are the exception. Some colleges meet the need of as many students as possible; others meet a portion of need for all students. In either case, there’s no guarantee that a student’s need will met.

Frequently Asked Questions

Who can I call for help with answering FAFSA questions?

You can call the Federal Student Aid Information Center at 1-800/4-FED-AID with questions about your application or about federal student financial aid in general.  

Why does the Department of Education ask for income information from the year before you go to school? 

Studies have consistently shown that verifiable income tax information from the base year is more accurate than projected year information when estimating how much the family will be able to contribute during the coming school year. 

What should you (the student) do if your family has special circumstances that aren't mentioned in the application?

Talk to your FAA. If your family's circumstances have changed from the base year due to loss of employment, loss of benefits, or death or divorce, the FAA may decide to adjust data elements used to calculate your EFC, which may increase your eligibility for student aid. 

If you live with an aunt, uncle, or grandparent, should that relatives income be reported instead of parental information? 

Only if the relative is your adoptive parent, as defined on the FAFSA. You can be considered to be dependent only on your parent's and may report only parental information on the FAFSA. You must report any cash support given by relatives, but not in-kind support (such as food and housing) from relatives. 

What if you live with a girlfriend or boyfriend who pays the rent? 

You should not report any information for a friend or roommate unless the two of you are actually married or are considered to have common-law marriage under state law. You must report any cash support given by the friend as untaxed income but should not report in-kind support (such as food). You would have to report as income the rent the roommate paid if your name were on the lease and if the roommate were paying the rent on your behalf.

When is work considered student aid?  

Generally, grants and scholarships are not considered to be taxed or untaxed income. If you have an ROTC scholarship, a private scholarship, or any other kind of grant or scholarship, that grant or scholarship will be considered as an available resource by the financial aid office when packaging aid but will not be reported as income on the application. You should report grants and scholarships that are reported on the tax return (because they are in excess of tuition, fees, books, and required supplies). You should report these items as exclusions from income.

What's the difference between cash support and in-kind support? 

Cash support is support given either in the form of money or money that is paid on your (the student's) behalf. You must report cash support as untaxed income. Thus, if a friend or relative gives you grocery money, it must be reported as untaxed income. If the friend or relative pays your electric bill or part of your rent, you must report those payments.

Examples of in-kind support are free food or housing that the family receives. You usually don't report such support. So, if you are living rent-free with a friend or relative, you do not report rental value as untaxed income, unless your name is on the lease. However, the application does require you to report the value of housing that the family receives as compensation for a job. The most common example is free housing or a housing allowance provided to military personnel or clergy.

You are now a U.S. citizen but have an Alien Registration Number (ARN), which box do you check?

Check the U.S. citizen box - do not check both, as this would cause a problem with the application. A person who has attained citizenship no longer uses the ARN associated with being an eligible non-citizen for purposes of applying for federal student financial aid. 

If you are an emancipated minor, are you now independent?

The status of emancipated minor is not recognized by the Department of Education for financial aid purposes; such a student must meet one of the other listed criteria to be independent. If you are in the National Guard or are an Active Duty military member, are you considered a veteran? No, you are a veteran only if you have been discharged from Active Duty other than dishonorably. Only a member of the National Guard who was activated in a situation such as Desert Storm and then discharged would meet the definition. Active Duty members of the military are not veterans until discharge. 

If your parents have not filed taxes and will not be able to file in time for a state or institutional deadline, can they wait?

If there is a risk of not meeting a deadline for state or institutional aid, the parents should calculate to the best accuracy their income and tax information but be prepared to supply tax returns if selected for verification by the Department's Central Processing System.

If your parents are divorced, whose information do you need?

The parent that you lived with the most during the past year. It does not make a difference which parent claims you as a dependent for tax purposes. If you did not live with either parent or lived equally with each parent, the parental information must be provided for the parent from whom you received the most financial support or the parent from whom you received the most support the last time support was given. 

What should you do if the parent with whom you live is remarried and the stepparent refuses to supply information?

If you are a dependent student and your parent is remarried, the stepparent's information must be included or you will not be considered for federal student financial aid.

How does a family decide who should be counted in the household size? 

Anyone in the immediate family who receives more than 50% support from the dependent student's parents or the independent student and spouse may be counted in the household size even if that person does not reside in the house, as in the case of a sibling who is over 24 but still in college and receiving the majority of support from parents. Siblings who are dependents of the date you apply for aid are also included, regardless of whether they receive at least 50% of their support from their parents. Any other person who resides in the household and receives more than 50% support from the parents may also be counted such as an aunt, cousin, etc. so long as the support is expected to continue throughout the award year. An unborn child who will be born during the award year may also be counted in the household size. Household size and tax exemptions are not necessarily the same. Exemptions look at the previous year or tax year and household size refers to the school year for which the student is applying for aid. 

If your parents are separated but filed a joint tax return, how is the information reported?

You should use only the qualified parent's financial information (the parent with whom you lived the most in the most recent twelve months). Use a W-2 or some document that demonstrates the qualified parent's share of the income and a tax table for the tax liability.

If you (the student) are separated but filed a joint tax return, how is the information reported?

You should give only your portion of the exemptions, income and taxes paid.

Who qualifies to be counted in the number in college?

Any person who is counted in the household and will be attending any term of the academic year at-least-half time. He or she must attend an eligible program at an eligible institution. You (the student) need not be enrolled half time, however, to be counted in the number in college. To be counted in the number in college, the person must also be working toward degree or certificate leading to a recognized education credential at a post secondary school that is eligible to participate in federal student aid programs.

What happens after you apply?

If you submit a paper version of the FAFSA, within four weeks, the U.S. Department of Education will send you a Student Aid Report (SAR). On the SAR will be either a request for further information or a number called an Expected Family Contribution (EFC). The Department uses a formula established by law to figure the EFC from the information you provide. Your college uses the EFC to determine the amount of your Federal grant, loan, or work-study award, if you are eligible. If you apply using FAFSA on the Web or FAFSA Express, you will receive a SAR in the mail approximately one week after your completed application, including a signature page, is received.

What if you don't get a SAR or you need another copy of your SAR?

If you do not get a SAR within four weeks, call the Federal Student Aid Information Center at 1-800/4-FED-AID. You can use the automated system, if you have a touch tone phone, to find out if your application has been processed, or you may request duplicate copies of your SAR however you will need to provide your Social Security Number and the first two letters of your last name. If you do not have a touch tone phone, you can call1-319-337-5665 to request duplicate copies of your SAR or to find out the status of your application.

What should you do if you or your family's financial circumstances change, such as a parent losing a job, or large medical expenses?

Some questions ask you to make projections, for example, about your family status for the coming year. If the answers to these questions change, you should check with the financial aid administrator's (FAA) at the schools you are interested in attending as soon as possible. The income and expense information reported on this form must be accurate for the past year, not for the coming year.