What is the Expected Family Contribution, Or EFC? JR’s Two Minute Financial Aid Tip


Episode 2
Download Episode Here

Partial Transcript more after the jump…

Hi, This is JR the College Money Man, giving you my Daily Scholarship and Financial Aid Tip in about two minutes.

Hi, this is episode 2, and today were talking about the Expect Family Contribution, or the EFC (The formula for this year is here). The EFC is what gets spit out after the department of education crunches the more than 130 items on the Free Application for Federal Financial Aid, or FAFSA.

See episode one for details

Now, the EFC helps to determine eligibility of students for any of the federal governments Nine financial aid programs, the over 600 grant & scholarships program offered by state governments, and most need based institutional aid in a majority of colleges and universities. Even some scholarship funds use the EFC as a tool to measure your individual need.

Now the EFC is a number that people should think of as a golf score: {sound effect = Golf hit} The lower it is the better.

In fact, if it is zero, you are in for a wide range of financial aid options. Now A students EFC has nothing to do with what it actually costs to go to college. Its simply the amount the government expects students and/or parents to contribute to that years educational expenses.

It can fluctuate from year to year {sound effect = Toy Whistle}

Now again, the higher your EFC is, the fewer programs you become eligible for

Now, there are a few break points in the EFC where you become eligble for some programs and not others. For example, if a student has a Zero EFC, they are eligible for up to $5,500 in Pell grant aid. In addition, those with Zero EFCs may also qualify for the Supplemental Educational Opportunity Grant, which is kind of the little brother of the Pell Grant for those with the lowest EFC’s.

However, as a students EFC rises to around 5000, less and less funds are made available from grant aid. So the key is to keep your EFC as low as possible to maximize the potential for grant aid.

So the key is to keep your EFC as low as possible through EFC reduction strategies, and we will talk about those in future episodes.

But heres a quick tip: Before you file the FAFSA, pay your bills! you want to reduce the amount of money in your checking and savings account on the day you file your FAFSA. The FAFSA asks about these amounts and just a little can effect the EFC a lot.

Have a problem with financial aid or scholarships? go ahead and send JR a tweet @ CollegeCashMan. Thanks for listening to JR’s Two Minute Financial Aid Tips at www.collegemoneyman.com.

The College Money Man Podcast, and JR’s Two Minute Tips are available for subscription for FREE via iTunes, and Stitcher. New episodes of 2-Minute Tips are released everyday Monday thru Friday, and our weekly broadcast is released each Wednesday. Subscribe, like, and comment! Download and get your dose of financial aid help on the go.


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