Q: I won’t qualify for financial aid. Do I need to fill out the FAFSA?

A: Yes! Regardless of whether you think you’re eligible for aid, you should complete the FAFSA. You have to complete it if you (or your student) intends to take out federal student loans, which are available to anyone regardless of need. If you have any intention of borrowing, the Direct Student Loan should be your starting point. Plus, some schools have a need component to merit scholarships, in which case you’ll need to complete a FAFSA to be considered. In addition, work study jobs require a FAFSA, so any student who thinks they might work in college should apply. Even if you don’t intend to borrow, it’s still a good idea. Your financial situation may change, necessitating borrowing, or you may want to have some leverage over your student’s choices such as “I’ll pay as long as you _____. If you don’t, you’ll need to take out a student loan.” And many people who don’t think they’re eligible for aid do in fact end up being eligible.

Q: I’m a trustee of a trust. Do I have to report it as an asset?

A: It depends on the trust. If as trustee you have the authority to change the beneficiary, then you do need to report it as an asset.

Q: I am a beneficiary of a trust, but I don’t have access to it. Do I have to report it?

A: Most likely. Even if your access to the trust is restricted, you still have to report it on the FAFSA. It’s important to report it correctly, though: in the case of split interests, for example, each beneficiary only reports the net present value of their portion of the trust. The only case in which a trust is not reported is if restrictions to its use were created by court order, as in the case of a trust created from proceeds of an accident settlement, which proceeds are for future medical expenses. If you are a beneficiary to a trust and that amount is impacting your financial aid, check the trust document to see if trustees can distribute additional property for HEMS purposes (health, education, maintenance and support) as this is a common trust provision.

Q: Do I have to report my 529 accounts for my other children on the FAFSA?

A: Yes. All parent-owned 529 accounts are reported, even if the student on the FAFSA is not the beneficiary. Good news: 529s get reported in the  parent asset section, so they’re subject to the asset protection allowance and the parent asset rate (5.64%). 529s owned by third parties (grandparents, other relatives) are not reported on the FAFSA. However, when funds are taken out of those accounts, they’re reported as income to the student on the FAFSA.

Q: Can my student just do the FAFSA on their own and call themselves independent?

A: The standard for a student to claim themselves as independent is pretty strict, and most of the ways of getting to that status (marrying and having a child, joining the military, or becoming an orphan or ward of the court) are not worth it.

Q: My student hasn’t applied to any schools yet. How do I know which ones to send the FAFSA to?

A: Send it to any schools your student intends to apply to. There is no cost to send it to schools, and the school won’t process it until they’ve accepted your student. If your student decides to apply to additional schools after you’ve completed the FAFSA, you can go back to your FAFSA and add those schools.