Back to basics on understanding the Expected Financial Contribution

by Grace

In the process of determining your family’s eligibility for college financial aid, it is important to understand exactly what the Expected Financial Contribution (EFC) is, and what it is not.

Here is a good explanation from Troy Onink in Forbes.

Calculating Your Expected Family Contribution (EFC)

Regardless of the aid form(s) the student is required to complete and submit as part of the process of applying for financial aid, and after all of the time and information it takes to complete the form(s), it all boils down to three letters, EFC, which stands for expected family contribution. You provide your financial information on the aid forms (FAFSA and CSS Profile), submit the forms online to the processing centers for each respective form, and the information from the forms goes into the aid calculations (the Federal Methodology, Institutional Methodology and Consensus Methodology).

The output of those need analysis calculations is the student’s expected family contribution (EFC) toward the cost of college. The student’s EFC is the minimum amount the student is expected to contribute toward the cost of college. Thus, EFC represents a dollar amount. It is the “output” of the aid forms and calculations. Your data goes in and your child’s EFC comes out and goes to the colleges’ aid departments that the child asks the data to be sent to on the aid forms. All three of the EFC formulas focus primarily on the assets and income of the parents and student, family size and the number of dependent children enrolled in college in a given year to assess the family’s ability to pay for college using the income and assets that they have. And because the three formulas calculate EFC differently, it’s likely that the student’s EFC under each formula will also be different.

As a general rule, the lower the EFC the higher the financial need and therefore the higher the chance of qualifying for financial aid.

From the FAFSA site comes this clarification:

Your EFC is not the amount of money your family will have to pay for college nor is it the amount of federal student aid you will receive….

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