6 Simple Steps to Fill Out FAFSA

Grace Lemire
Grace Lemire

Grace Lemire is a freelance writer and editor with over five years of experience in the personal finance industry. She has been featured on a variety of publications, including NPR, CNN, FinanceBuzz, Dollar Geek, Pangea, and True Finance. Her work focuses on the intersection of personal finance and technology. In 2023, Grace was nominated for the Best Personal Finance Advice award in Debt.com’s FinTok Awards.

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Daniel Kahn
Daniel Kahn
Daniel is the co-founder and COO at Sparrow. Daniel is responsible for the day-to-day operations of a company, working closely with other members of the executive team to develop and implement strategies to support the growth and success of the company.
Daniel was a 2023 Forbes 30 Under 30 lister in the Education category.  Daniel was born and raised in Raleigh, North Carolina and graduated from Duke University in 2020.
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Camden Ford
Camden Ford

Camden leads Sparrow’s business operations – everything from product management to business analytics. After graduating Cum Laude from Duke University where he studied Civil Engineering, Camden worked as a Consultant for A.T. Kearney where he worked in their Strategic Operations practice. With a strong background in analytics, Camden strives to deliver data-driven conclusions and insights.

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November 13, 2023

We won’t lie to you. The FAFSA is an animal.

The FAFSA, or Free Application for Federal Student Aid, is the form you fill out to get financial aid from the U.S. Department of Education to help pay for college

The information you provide on the FAFSA will determine your eligibility for thousands of dollars worth of financial aid. So, due to the nature of it, the form is big and asks for a lot of information. To make it more seamless, we’ve broken down the process of filling out the FAFSA into 6 simple steps.

Understanding FAFSA

FAFSA determines which students receive financial aid and how much they will get. Believe it or not, over 13 million students each year get more than $120 billion in grants when they file the FAFSA. (a.k.a. you better fill out the FAFSA!)

Note: We’re calling this the FAFSA process because you’re truly not finished with it until the final step when you complete entrance counseling. You could also call this the Federal Aid Process.

Completing the FAFSA Process in 6 steps:

  1. Get Informed
  2. Fill it Out
  3. Compare Aid Offers
  4. Reply to Aid Offers
  5. Sign a Loan Agreement 
  6. Complete Entrance Counseling

Step 1: Get Informed 

The FAFSA collects information to determine your eligibility for financial aid. Your Expected Family Contribution, year in school, enrollment status, and the cost of attendance at the school are used to determine your eligibility.

Expected Family Contribution: A number that indicates a student’s ability to pay for college.

This number is calculated using a formula established by law and uses information such as your family’s income, assets, and benefits.

Your Year in School: The amount you can borrow in federal student loans depends on whether you’re an undergraduate student, a graduate or professional student, or a parent.

Undergraduate student

You can borrow between $5,500 and $12,500 per year in Direct Subsidized Loans and Direct Unsubsidized Loans depending on what year you are in school and your dependency status.

Graduate or professional student

You can borrow up to $20,500 each year in Direct Unsubsidized Loans. Direct PLUS Loans can also be used for the remainder of your college costs, as determined by your school, not covered by other financial aid.

Parent of a dependent undergraduate student

You can receive a Direct PLUS Loan for the remainder of your child’s college costs, as determined by their school, not covered by other financial aid.

Cost of Attendance: The price tag (cost) of a year at school. This number includes everything from the basic tuition and fees to the cost of books, supplies, and transportation.

Enrollment Status: This indicates whether a student is full-time, three-quarter time, part-time, withdrawn, graduated, etc.

Step 2: Fill it Out

After you’ve taken some time to understand what you’re actually applying to, you’ll need to sit down and apply. We won’t sugarcoat it – completing the application is quite an endeavor. However, if you come prepared with all the information you’ll need to fill it out, you can bang it out in around an hour.

Make sure you have the following on hand:

  1. Your social security number (Make sure you verify this and don’t just go off of memory. It is crucial that you enter this correctly on the FAFSA form.)
  2. Your parent’s social security numbers (if you are a dependent)
  3. Your Alien Registration number (if you are not a US citizen)
  4. Tax Information such as tax returns including IRS W-2 information
    • If applying as a dependent, make sure you have your parent(s) tax information as well
  5. Records of any untaxed income such as child support, veteran benefits, etc.
  6. Information on cash you may have, such as:
    1. Bank account (checking and savings) information
    2. Investments such as stocks and bonds
    3. Business assets

Having this information at the ready will help speed up the process of filling out the FAFSA form. You can complete the form here.

Step 3: Compare Aid Offers

After you’ve filled out the FAFSA, the financial aid office at your school will send you an aid offer. Sometimes referred to as an aid letter, this will detail what financial aid you can receive. The offer will include the types of aid you may get from federal, state, private, and school sources. This sum of financial aid is your financial aid package.

Now, it’s a good idea to figure out the net price for each school you applied to. This will help you determine which school will be the most affordable. To do this:

  1. Find the cost of attendance on the aid offer. If you cannot locate it on the aid offer, contact the school’s financial aid office.
  2. Subtract grants, scholarships, and any savings you plan to put towards college from the total cost of attendance . This is known as your net or out-of-pocket cost.
  3. Compare the net costs and amount of debt you would be taking for each school.

Step 4: Reply to Aid Offer

Once you’ve decided where you want to attend, you will want to reply to the aid offer.

Accept financial aid in this order: free money (i.e. scholarships, grants), earned money (i.e. work-study), borrowed money (i.e. federal student loans).

When accepting federal student loans, you want to accept a subsidized loan before an unsubsidized loan. This is because subsidized loans do not start accumulating interest until after you leave school.

Federal loans will typically have more favorable terms and conditions than private loans (interest rates, repayment periods, etc.). Evaluate your federal loan options and accept what makes sense before deciding on a private loan.

A few additional things you will want to be aware of:

  1. Some scholarship and grant programs have specific requirements to remain eligible. If you receive a scholarship that renews year over year, make sure you’re informed of the ongoing requirements.
  2. Accepting work-study is a great idea, but be realistic with yourself. Make sure to balance your time between work and studying.

Step 5: Sign Loan Agreement

Okay, now you’ve decided what part(s) of your financial aid package you want to accept. (deep breath, only 2 more steps…we promise)

To receive federal student loans, you will need to sign a document called the Master Promissory Note (MPN). Signing the MPN signifies you agreeing to repay your loan(s) and any accrued interest and fees to the U.S. Department of Education. It also details the terms and conditions of the loan(s).

Find MPNs:

If you are an Undergraduate Student.

If you are a Graduate/Professional Student. Choose between Direct Unsubsidized Loans and Direct PLUS Loans.

If you are a Parent of an Undergraduate Student. Parents must log into their own account to submit.

Step 6: Complete Entrance Counseling 

Entrance Counseling is the final step in the FAFSA process.

Through entrance counseling, you will learn what a loan is, how interest works, the terms and conditions of your loan, your options for repayment, and how to avoid default. Once you have completed counseling, a record of it will be sent to your school so your loan money can be disbursed.

Find Entrance Counseling:

If you are an Undergraduate Student.

If you are a Graduate/Professional Student.


After completing all these steps, you will have completed the FAFSA process and accepted financial aid. Following each step carefully is the most important part. If you have any questions, make sure to pause and find the answer before proceeding. (now deep breath #2 – you got this!)

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