Financial Aid Fundamentals
Need-Based Aid is aid awarded by colleges based on the college’s assessment of a student’s ability to pay compared to the college’s Cost of Attendance (COA), and includes both grants that do not need to be repaid and loans that do. COA - also referred to as “sticker price” - includes tuition, housing and meals, books, transportation and personal expenses. Institutions provide net price calculators (NPC)’s on their websites where you can estimate the actual costs you will pay based on your financial situation. We highly recommend screen-grabbing (and dating) each NPC estimate, since this information could be useful later on if you need to appeal your aid award.
“Ability to pay” is calculated by the Free Application for Student Aid form “FAFSA”; some colleges also require the College Scholarship Service Profile “CSS Profile”. Read the suggestions below to consider whether you should apply for need-based aid. Note that the FAFSA and CSS deadlines vary by school. You are responsible for checking the financial aid website for each college your student applies to, as deadlines vary significantly by school and can include priority dates for early applicants. Missing a deadline can seriously jeopardize a student’s eligibility for aid.
For those planning to apply during the Early Decision or Early Action rounds, financial aid deadlines are usually November 1 or 15. Know your deadlines. The FAFSA and CSS Profile will ask detailed questions about your 2024 income, current assets, and demographic information. Have your 2024 federal tax returns, current bank statements, and records of any other assets and investments on hand.
Unlike need-based aid, merit-based financial aid does not take into account a student's financial situation. Merit aid is a general term for grants, scholarships, and tuition discounts that are awarded based on the value a student may bring to a campus. Many highly selective colleges do not offer merit aid; the best way to check if a college on your student’s list offers non-need based tuition assistance is to reference the common data sets (CDS). The CDS for each of the colleges your student is applying to is linked from your college list spreadsheet. Section H of the CDS lists the total number of students who received non-need-based scholarships and grants and the average dollar amount of non-need-based gift aid awarded.
While most schools automatically consider students for merit-based aid upon application, some institutions have separate scholarship applications and priority deadlines for merit aid. We do our best to keep track of these additional deadlines, and support our comprehensive clients with any merit-based additional essays. However, students and families are responsible for checking college’s financial aid websites and tracking additional merit aid requirements and dates.
Who Should Apply for Financial Aid?
Anyone who believes they might qualify for need-based financial aid. Running the net price calculator on the website of four, five, or six institutions a student plans to apply to will give you a pretty good idea of whether the student will be eligible for much, if any, need-based aid.
Anyone who thinks they may require financial aid at any point during their child’s undergraduate career. Some colleges will not consider a request for institutional aid if the student did not submit the necessary forms when they first applied as a freshman or transfer student. Other colleges may require a waiting period of at least a full academic year for such students.
Anyone who expects to have two or more children in college at the same time, which may significantly lower the threshold for need-based eligibility. The FAFSA no longer uses the number of children in college as a factor in federal aid eligibility, but this sibling question remains on the new FAFSA form. Many colleges will continue to use this data in calculating institutional aid, often a much larger source of grants and scholarships.
Anyone applying for merit aid at institutions that require the FAFSA or CSS Profile for these awards. Although the vast majority of institutions do not require submission of these forms for merit aid, it is necessary to verify on each college’s website, or with the admission office that administers merit aid, whether these forms are required.
If the sticker price is not a financial burden, you are confident there will be no significant financial hardships during the student's undergraduate years, and you have confirmed that the schools on your list do not require the FAFSA or CSS profile to be considered for merit aid (or if you are not interested in merit aid), then there is no reason to submit the FAFSA or CSS Profile.
About the FAFSA
The FAFSA is the gateway to all federal financial aid, including Pell Grants, federal student loans, and federal work-study. All colleges that participate in federal aid programs require the FAFSA. It is a standardized form that uses a "Federal Methodology" to calculate a Student Aid Index (SAI), which determines your eligibility for federal aid.
The FAFSA primarily focuses on income derived from federal tax returns, and considers cash, savings, and investments. It excludes the value of a family's primary residence, retirement savings (like 401ks and IRAs), and the net worth of a small family business.
The 2026-27 FAFSA will be accessible on October 1, 2025 at https://studentaid.gov/h/apply-for-aid/fafsa. As mentioned earlier, the FAFSA is based on your income from two years prior. Make sure you have your complete 2024 tax forms available and ready to access by early October! You and your student each need to create your own FSA ID, and we highly recommend creating these IDs and familiarizing yourself with the form when it opens in early October. (Note: only one of a student's parents needs to sign the student's FAFSA form, so only one parent needs an FSA ID.)
About the CSS Profile
The CSS Profile is an application used by a few hundred (mostly private) colleges and scholarship programs to award their own institutional grants and scholarships. It uses an "Institutional Methodology," which can vary slightly from school to school, allowing colleges to get a more detailed and nuanced picture of a family's financial situation. The list of institutions that require submission of the CSS Profile for institutional need-based aid can be found here, but it is always best to verify with the college itself. Note that most institutions require the CSS Profile in addition to the FAFSA.
The CSS Profile takes a comprehensive look at income, often asking for two years of past tax information and an estimate of the coming year's income. It includes not only taxable income from a family's tax returns but also untaxed income sources such as contributions to retirement accounts, non-taxable benefits, and child support. Unlike the FAFSA, it also considers home equity, the net worth of any small business or farm, retirement accounts and the value of all savings, investments and trusts (student and parent owned). Learn more about the CSS and its requirements here: https://cssprofile.collegeboard.org/getting-started.
For current high school seniors or transfer students expecting to attend college in the fall of 2026 school year, the Fall 2026/Spring 2027 CSS Profile can be accessed and submitted at https://cssprofile.collegeboard.org beginning October 1, 2025. Trying to access the CSS Profile earlier than this date will direct you to the current year’s form, not the 2026-2027 form.
The CSS Profile belongs to the student, though often an adult will complete it on the student’s behalf. It is recommended that the student or parent login to the CSS Profile using the student’s College Board account. (If your student has taken an AP, PSAT, or SAT test via College Board, they already have a College Board account). Be sure to give yourself plenty of time to complete the form and aim to have it completed two weeks before your first application deadline.
Unlike the FAFSA, each biological parent and stepparent is listed on the CSS Profile. In cases of separation or divorce, the noncustodial parent will be sent a link to create their own CSS Profile. Neither parent will see the other’s completed form or financial information.
IDOC stands for Institutional Documentation Service, and is an additional service to assist with financial aid documentation. Similarly to the CSS Profile, the IDOC is also administered by the College Board. Each college decides which forms they need from you, and if the IDOC is required, you'll be notified via your College Board account as to which documents need uploading. Students can check here for CSS Profile, IDOC, and Non-Custodial Parent Information requirements for each of their college choices.
About Parent Plus Loans
Parent PLUS Loans are a type of federal student loan that allows parents of dependent undergraduate students to borrow money to cover the cost of their child's education. A significant feature of these loans, historically, was the ability to borrow up to the full cost of attendance, as determined by the school, minus any other financial aid received. However, the passage of the "One Big Beautiful Bill Act" (H.R. 1) in July 2025 introduced major changes to both borrowing limits and repayment options, which will be effective starting July 1, 2026.
The most impactful change is the new cap on borrowing. Starting July 1, 2026, parents will be limited to borrowing a maximum of $20,000 per year per student, with a new aggregate lifetime limit of $65,000 per student. This is a dramatic shift from the previous policy of borrowing the full cost of attendance and will significantly affect families who rely on these loans to finance a large portion of their child's education.
The new law also severely restricts the repayment plans available to Parent PLUS borrowers. For any new loans disbursed on or after July 1, 2026, Parent PLUS borrowers will no longer be eligible for most Income-Driven Repayment (IDR) plans. They will be limited to a new standard repayment plan and a new Repayment Assistance Plan (RAP). To retain access to a form of income-based repayment, existing Parent PLUS borrowers must consolidate their loans before the July 1, 2026, deadline. A grandfathering clause allows parents with existing Parent PLUS loans to continue borrowing under the old rules for up to three additional years or until their child graduates, whichever comes first, but only with respect to those pre-existing loans.
Parents apply for a Parent PLUS Loan online through the official Federal Student Aid website, StudentAid.gov. Before applying, the student must have a completed FAFSA on file. The application for the upcoming academic year generally becomes available in late April or early May, and it's recommended to apply no more than 90 days before the start of the semester, as the credit check is only valid for 180 days. After a credit check is performed and the parent is approved, they must sign a Master Promissory Note (MPN), a legal document agreeing to the loan's terms. It's also wise to check with the college's financial aid office for specific deadlines and procedures to ensure the loan is processed in time for tuition payments.
Note: While I aim to provide clear and accurate information, I am not a licensed financial advisor. This post is intended for general educational purposes only. Families with specific financial questions should consult a licensed financial advisor or financial aid expert.
