For millions of students each year, college can seem out of reach before completing one important step — the Free Application for Federal Student Aid (FAFSA). It may seem unceremonious, but this application can unlock grants, scholarships, federal work-study, and federal student loans, all helping to cover the cost of a college education.
As an important step on the way to college, unfortunately the FAFSA can also be a huge headache. The Hechinger Report calls it one of the “most complex and convoluted higher education forms and documents,” noting that some of the required information can be hard for families to access. Amid COVID-19, FAFSA completion among graduating high school seniors is down 3.3% compared to last year, and the decline appears to disproportionately impact students from low-income backgrounds.
Many students are feeling uncertain about their plans for the fall given the disruptions caused by the pandemic. But if college is even a possibility, they should be sure to complete the FAFSA as quickly and as carefully as possible. Reporting financial details accurately is critical to the process. Otherwise, students may find their financial aid locked up in a process known as verification.
Financial Aid Verification
According to the National College Attainment Network (NCAN), about half of Pell-eligible students are selected each year for verification, which requires them to submit additional documentation to verify the information on their application. Advisors may understand this as a simple process of tracking down paperwork, but students often feel overwhelmed by the high stakes. Complicating matters, their parents may be reluctant to share financial information, while navigating the IRS website can feel like reading a foreign language.
Students can find the verification process so intimidating, time-consuming, and downright discouraging, that far too often, they end up never completing it. It’s an issue known as “verification melt” that affects nearly one in four low-income students selected for verification — leaving them without financial aid, and often without a path to college.
Leaving Money on the Table
That brings us to this year, to the added financial stress facing many American families and the challenges of social distancing.
About half of lower-income families have experienced job loss or lost wages due to COVID-19, according to a report by Pew Research Center. Prospective college students enrolling this fall will need increased financial aid, and if they are selected for verification, completing the process early will put them in the best possible position. Some institutional aid is first-come, first-served, so processing delays due to verification can amount to missed funding opportunities.
What’s more, the economic recession is only reinforcing the value of a college education. Those without a degree have been hit hardest. Verification melt is simply not an option — these students can’t afford to leave money on the table and miss out on the opportunity to pursue higher education.
Impact on the Verification Process
When a student is selected for verification, ideally they are prepared with a computer, Wi-Fi access, a printer, and a scanner to get through the process in the privacy of their home. Realistically, students have always had to jump through hoops to locate, print, and process their documentation. And that was before coronavirus. Understandably, many students won’t be eager to rush to a public library or FedEx Office, risking exposure to complete the verification process.
The IRS is also subject to local health guidelines, and as such, students may experience delays in securing documentation. According to the IRS website, certain services including “live assistance on telephones, processing paper tax returns and responding to correspondence” continue to be reduced or suspended, and it’s unclear when normal operations will resume.
Given these challenges, the support of a trusted advisor can help ensure students are prepared to navigate the verification process and stay on track for college this fall. Here are a few tips for advisors to consider amid COVID-19:
- Encourage students to start the process early. This is good guidance every year, but COVID-19 has increased the likelihood of processing delays, particularly when requesting IRS documentation. Completing the process earlier will also reduce the chance of missing out on first-come, first-served institutional funding.
- Help students troubleshoot concerns around their health and safety. Are they anxious about visiting a public facility, but don’t have a printer at home? Encourage them to ask for help from a friend they trust, or if you’re able, offer the printer at your office. Has their family been unable to purchase masks? Help them find a reputable vendor or put an extra mask in the mail.
- Stay up to date on the latest guidance from the Department of Education, the IRS and the National Association of Student Financial Aid Administrators (NASFAA). NASFAA has published a guide to pertinent COVID-19 news, updated daily at www.nasfaa.org/covid19.
Financial aid brings a college education within reach for millions of students across the country each year. With the expertise, support, and encouragement of an advisor, students can avoid verification melt and continue along the path towards a college degree.