Most Kids’ Chance state organizations and affiliates use financial information derived from the U.S. Free Application for Federal Student Aid (FAFSA) to determine student scholarship awards. In 2021, the U.S. government took significant action approving several FAFSA updates to benefit students and families. Most changes will take effect in the 2023-24 FAFSA cycle, beginning on October 1, 2022.

As part of student relief efforts, in the current academic year, post-secondary institutions may ask to verify personal identity and high school completion, but schools will not ask to verify income or family size.

Two significant changes in the 2022-23 financial aid cycle, which began on October 1, 2021, are based on students’ answers to two questions that affect a student’s eligibility for federal financial aid. According to StudentAid.gov, the federal government’s official website:

• "Drug convictions no longer affect federal student aid eligibility. As students complete the FAFSA form, they will be asked whether they had a drug conviction for an offense that occurred while they were receiving federal student aid. If the answer is yes, students will be provided a worksheet. Students should answer the questions correctly; however, the questions won't impact students' eligibility."
• "Registration status with Selective Service no longer affects students' eligibility to receive federal student aid. However, students can still register through the FAFSA form.”

Other beneficial changes to be implemented in the 2023-24 aid cycle, beginning on October 1, 2022, include the following:

• Shorter application from 80+ to 36 questions
• IRS tax information imported
• Expected Family Contribution (EFC) will be called Student Aid Index (SAI)
• SAI can be negative! Below $0 – to identify neediest students
• Pell grant eligibility expanded (based on household size and income, not EFC/SAI; 1/2 million more students eligible)
• Unemployment + national emergency + professional judgement = more students eligible for Pell grants and other funding
• Federal direct subsidized loans will be available until degree completion (it was previously capped at 6 years for 4-year programs)

As scholarship providers, Kids’ Chance organizations should review their application and award materials and update them to reflect the change in nomenclature from EFC to SAI, and the possibility of students being assigned a negative SAI.These following sources were used to develop this blog post and can be referred to for more information:

• https://financialaidtoolkit.ed.gov/tk/learn/fafsa/updates.jsp#2021-22-changes
• https://financialaidtoolkit.ed.gov/tk/learn/fafsa.jsp
• https://www.forbes.com/advisor/student-loans/fafsa-changes