When Finances Change While Your Student Is in College

Finances change; it happens. Instead of panicking because your student attends an expensive college, follow this advice to possibly receive more financial aid.

When submitting the Free Application for Federal Student Aid (FAFSA), students and their families are expected to provide information based on their financial situation. However, household finances can change at any time, whether that’s due to a parent losing their job, a natural disaster, the death of a parent, or a large, unexpected medical expense. 

An added complication: In 2016, the FAFSA began asking for tax returns from two years prior to submission (i.e., the FAFSA for the 2021–2022 academic year require copies of 2019 tax returns). A lot can happen with family finances in two years, so it’s possible your student’s financial aid award letter doesn’t reflect your current situation. If you believe a financial change you’ve experienced is substantial enough to warrant additional financial support, you can request a “Change in Circumstances” form directly from the school’s financial aid office. Here’s how.

How to file a Change in Circumstances form

A Change in Circumstances form is an official financial aid package appeal that’s filled out based on new financial factors. Each school uses its own paperwork, but generally, students and parents are required to fill out the form and provide copies of supporting documents. Here’s an example of a school’s form, which shows the types of information you’ll be requested to provide. These documents include W-2s, evidence to substantiate the extenuating circumstance, and filed federal tax returns. The parent and student will both need to certify the request with their signatures. The school’s financial aid administrators will then review the Change in Circumstances form and documentation to decide if your student’s aid award can be adjusted. These decisions are handled on a case-by-case basis, so submitting a request form doesn’t guarantee your student additional aid.

If an award adjustment is granted based on your specific circumstances, it might come in the form of various types of financial aid. For example, if you’ve lost your job, your student might become eligible for a higher percentage of need-based aid in their award package, like scholarships, grants, or federal subsidized loans. 

Related: Financial Aid Terms You Need to Know

Will finding new employment impact my student’s financial aid package?

Generally, parents who later secure new employment don’t have to worry about putting their child’s financial aid for the current year in jeopardy. However, when their student submits a FAFSA renewal for the following academic year, the parents’ most current financial information is required, which may affect the structure and/or details of your student’s award package if your finances have restabilized after the change. For example, an increase in salary may make your child’s loans transition from need-based direct subsidized loans to direct unsubsidized loans, which offer no deferment of interest payments. 

If your situation has dramatically changed since your student first submitted their FAFSA, it’s worth reaching out to their college’s financial aid office. Financial aid officers can clarify the available options based on your family’s unique situation and offer your student resources to help them stay on course with their education.

Related: Get More Money by Appealing Your Financial Aid Award 

A change in financial circumstances can be stressful at the best of times—but when you’re trying to help pay your student’s way through college, it can feel downright overwhelming. Take a breather and assess your options for your finances sooner rather than later to put yourself in a good place.

For more advice on the college and financial aid process, check out our Parents section.

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Tags:
finances financial aid financial changes money for college parents paying for college

About Callie McGill

Callie McGill is a Content Marketer for ValuePenguin.com.

 

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