A financial aid package often includes work-study as one component. Typically the package includes a dollar sum of work-study income to be used for education costs. It’s up to the student to find a qualifying work-study job once they arrive on campus, and there is no guarantee that such a job is available.

Work-study jobs look a lot like regular jobs: They may be on-campus or not, and students are paid by paycheck, not by having the funds directly reimburse the university for tuition or other expenses. They pay at least minimum wage and hours depend on the employer. Earnings are taxable to the student, too.

There are a couple of differences, though: Work-study jobs cannot exceed the income limit in the work-study award. Let’s say your student is awarded $1,500 annually in work-study. After working 10 hours per week at $10 per hour, they will have maxed out the award midway through the second quarter of the school year. The employer may or may not continue having the student work as a “regular” employee at that point and if not, the student who needs to continue earning will have to find another job.

Another big difference is a positive: Earnings from a work-study job are subtracted from the student’s income for FAFSA purposes. That means that a student who has other income sources that put them close to or over the student income protection allowance– such as a summer job or funds coming from someone other than their custodial parent– will not see an EFC increase as a result of work-study earnings. When filling out the FAFSA, the student reports total income first, then work-study earnings under Additional Financial Information; the work-study amount is subtracted from the total.

One question that often comes up is whether a student should seek other employment if they are unable to find a work-study job, or if their work-study job doesn’t offer enough hours. The answer is generally “yes,” especially after Jan. 1 of sophomore year. With the FAFSA’s prior-prior income calculations, the student’s income only matters for FAFSA purposes up to Dec. 31 of sophomore year (assuming they’ll graduate in 4 years). The primary exception to that yes is a student in the early years of college whose other income sources (job, external money) puts them over the student income protection allowance ($6,570 in the current FAFSA).