What is the Free Application for Federal Student Aid (FAFSA)?

1 min readLast updated March 8, 2024by Unbiased team

Learn all about how the FAFSA works for students needing help paying for college.


  • The FAFSA is an official form students use to apply for assistance in paying for college. 

  • The federal government may offer grants, work-study programs, or loans for this purpose. 

  • States, private scholarship programs, universities, and colleges also use the FAFSA to make decisions on financial aid. 

  • A financial advisor will provide expert advice about college funding, savings, and your financial future. 

What is the FAFSA? 

The Free Application for Federal Student Aid (FAFSA) is the official form all students must use when applying for federal student aid.  

This financial assistance could include: 

  • Grants 

  • Scholarships 

  • Work-study funds 

  • Student loans 

Many colleges and states also consider student’s applications for federal student aid when determining their eligibility for school and state aid and deciding on the amount to award each student.  

Even private aid providers may use this form to make their financial decisions. 

How does the FAFSA work? 

More than 13 million applicants fill out the FAFSA annually, with the federal government paying out approximately $120 billion in grants, work-study, and low-interest loans.  

After submitting an application for federal student aid, the government emails students their Student Aid Report (SAR).

This report summarizes the information provided on the FAFSA and states the student's Expected Family Contribution (EFC).  

The EFC is not an amount the student must pay towards college fees but an index that institutions use to determine eligibility. To eliminate confusion, the EFC changed its name to the Student Aid Index (SAI) in 2024.  

The SAI extracts the financial details from the FAFSA to assess a student’s aid eligibility. Students with SAIs below zero qualify for the Pell Grant, a federal grant for those with extreme financial need.  

Students who don’t qualify for the total amount may receive subsidized loans, state aid based on their income, financial assistance from their institution, work-study programs, scholarships, unsubsidized loans, or PLUS loans.  

Applicants must fill in a new FAFSA form for every year of study. 

How long does it take to fill out the FAFSA? 

For many years, applicants and their families struggled with how to fill out the FAFSA.

However, it was simplified for the 2024 -2025 award year. Applicants can skip up to 26 questions, decreasing the time it takes to complete the form. 

Government data shows it takes applicants under an hour to fill out the FAFSA.  

Students can accelerate the process by: 

  • Creating an FSA ID ahead of time 

  • Gathering all necessary documentation before filing the FAFSA 

  • Using the myStudentAid FAFSA app 

  • Using the IRS Data Retrieval Tool 

What is the CSS Profile, and how does it compare to the FAFSA? 

The College Scholarship Service (CSS) Profile is another avenue for students to receive financial aid for their education.  

Completing the CSS Profile allows prospective students to apply for private student aid from a host of scholarship programs and universities.  

It is helpful to apply for financial assistance via the CSS Profile and the FAFSA to gauge how much aid you’re eligible for from the federal government and private institutions.  

Although both the FAFSA and the CSS Profile can provide financial aid, there are several differences between the two: 


  • Type of aid: State and federal assistance, such as grants, loans, and scholarships 

  • Fee: Free 

  • Necessary information: Personal details of student and parents, such as income, business income, and assets 

  • Eligibility: U.S. citizens and certain non-U.S. citizens, such as permanent residents, asylum seekers, and refugees 

  • Participating schools: Any tertiary institution offering federal financial assistance 

  • Application Renewal: Annually 

CSS Profile: 

  • Type of aid: The school provides grants, scholarships, and loans 

  • Fee: $25 for a single school, $16 per additional school 

  • Necessary information: Income and asset information, bank statements, business income, untaxed income and benefits records, medical expenses 

  • Eligibility: U.S. citizens and international students 

  • Participating schools: Participating institutions 

  • Application Renewal: Annually 

Who qualifies for FAFSA? 

FAFSA provides aid to various groups, including U.S. citizens, permanent residents, and people with Arrival-Departure Records from the U.S. Citizenship and Immigration Services such as refugees.  

Students must be enrolled at a school that can receive federal aid to receive financial assistance.  

When is the deadline for the FAFSA? 

Applications for federal student aid open on October 1 every year and close at 11.59 p.m. (Central time) on June 30.  

Due to the high number of applicants and the varying college and state deadlines, it’s wise to complete the FAFSA as soon as possible from October 1. 

What is the income limit for the FAFSA? 

There is no income limit to receive federal student aid.  

Still, the government only awards certain financial assistance to low-income students.  

Each student’s individual EFC or SAI determines their need. 

Get expert financial advice  

Many students depend on financial aid to pay for their college education.  

The FAFSA is federal funding for this purpose. Most people applying for this benefit qualify for the FAFSA, but not all will receive full funding. The amount and type of aid depend on their financial need, despite there being no income limit. 

For expert financial advice on preparing for college and other financial scenarios, Unbiased can match you with a financial advisor perfectly suited to your unique circumstances. 

Find a financial advisor now.  


Unbiased team

Our team of writers, who have decades of experience writing about personal finance, including investing and retirement, are here to help you find out what you must know about life’s biggest financial decisions.