FAFSA 101: Why Every Family Should File the FAFSA (Even If You Think You Won’t Qualify)

When it comes to preparing for college, few forms strike as much fear—and confusion—as the FAFSA. Short for Free Application for Federal Student Aid, the FAFSA is the primary financial aid form that determines whether your family is eligible for federal, state, and institutional financial assistance.

In this episode of the College! Podcast, hosts Matt Carpenter and Peg Keough dive deep into the FAFSA—what it is, why it matters, and the common mistakes families make when skipping it. If you’re a parent or student navigating the college process, this guide will help you understand why filing the FAFSA is essential.

What Is the FAFSA?

The FAFSA, or Free Application for Federal Student Aid, is the form colleges use to evaluate a family’s ability to pay for school and determine eligibility for aid.

  • Federal aid: Grants, work-study, and loans directly from the U.S. government.
  • State aid: Many states rely on FAFSA data to award scholarships and grants.
  • Institutional aid: Colleges themselves use FAFSA data to award need-based institutional grants.

Of the 3,000+ colleges in the U.S., nearly all require the FAFSA. A smaller group—roughly 250 schools—also require the CSS Profile, another financial aid form that digs deeper into family finances. But for the vast majority of families, the FAFSA is the gateway to financial assistance.

Why You Should File the FAFSA (Even If You Think You Won’t Qualify)

One of the biggest misconceptions families have is that the FAFSA is only for low-income households. That’s simply not true. Matt and Peg outline several critical reasons why every family should file:

1. Merit Aid May Depend on It

Many colleges require the FAFSA on file—even for families seeking non-need-based aid, also known as merit scholarships. Without the form, your student could lose out on $10,000–$20,000 or more in annual scholarships.

2. Circumstances Change

Life is unpredictable. Job loss, illness, or unexpected financial setbacks can strike without warning. Filing the FAFSA from the start ensures you’re “on record” with the college. Without it, some schools won’t allow you to request aid later, even if your financial situation changes.

3. Access to Federal Student Loans

Filing the FAFSA automatically makes students eligible for Federal Direct Student Loans—low-interest loans in the student’s name. Even if a family doesn’t need loans, taking out a small amount can help build a student’s credit history. Parents can always pay it off on their behalf.

4. Appeals Are Stronger with a FAFSA on File

If you ever appeal a financial aid award, schools often consider families more favorably when a FAFSA has already been submitted. Without it, appeals may not even be reviewed.

Busting the FAFSA Myths

Matt and Peg also address some of the most common myths surrounding FAFSA:

  • “We make too much money.” Families with incomes over $300,000 are often surprised to learn they still qualify for significant aid at private colleges. Variables like family size, number of children in college, and assets play a role.
  • “Filing will hurt my child’s admission chances.” Most schools are need-blind, meaning admissions decisions are made without regard to financial need. For schools that are need-aware, finances may only play a role for students on the edge of admission decisions. The bottom line: if you can’t pay full price, you need to file.
  • “We can wait and apply later if needed.” Many schools require families to apply freshman year. If you don’t, you may not be allowed to request aid later.

FAFSA Deadlines: Why Timing Matters

While the FAFSA officially opens on October 1, families don’t need to rush at midnight. What matters most is meeting your college’s priority financial aid deadline. For most schools, that’s no earlier than November 1.

Here are some key tips Peg shares:

  • Know your deadlines. Each college sets its own requirements. Some align with admission deadlines, while others extend into spring.
  • Don’t wait too long. State aid and certain grants may be first-come, first-served. Early submission ensures you’re in the queue.
  • Get organized. Track deadlines in a spreadsheet or binder. Missing even one can cost your family thousands.
  • Parent pro tip: Colleges often email important updates only to the student. Set up a shared email account so nothing falls through the cracks.

The Bigger Picture: FAFSA as a Financial Safety Net

At its core, the FAFSA is about creating options. Filing keeps the door open for:

  • Need-based grants
  • Merit scholarships
  • Federal loan programs
  • Stronger appeal opportunities
  • Future flexibility if your financial situation changes

As Peg emphasizes, the FAFSA doesn’t share your information with third parties—only the government and the colleges you select. By filing, you give your family the chance to maximize available resources without leaving money on the table.

Final Thoughts

Filing the FAFSA is not just for families in financial hardship—it’s a smart move for every family sending a student to college. From scholarships and grants to low-interest loans and appeals, the FAFSA unlocks opportunities that can make college more affordable.

As Matt puts it, “Don’t make assumptions. Too many families leave $200,000 on the table by skipping the FAFSA.”

So mark your calendar for October 1, gather your documents, and submit the FAFSA early. It’s one of the simplest, most important steps you can take to reduce the cost of college.