FAFSA glossary.

Your total income minus specific deductions, as reported on your federal tax return. The FAFSA uses your AGI (from 2 years prior) as a key input to calculate your Student Aid Index.

A document from a college detailing the financial aid they're offering you, including grants, scholarships, work-study, and loans. Compare award letters by focusing on net cost — total cost minus free money (grants/scholarships).

A federal loan that combines multiple federal student loans into a single loan with one monthly payment. This can simplify repayment but may increase total interest paid over time.

Anyone who needs to provide information on your FAFSA. For dependent students, this typically includes at least one parent. If the parent is married, a stepparent may also be a contributor. Each contributor needs their own FSA ID.

The total estimated cost of attending a school for one academic year, including tuition, fees, room and board, books, supplies, transportation, and personal expenses. Schools calculate this figure — it's not just tuition.

A determination by a school's financial aid office that allows a dependent student to be treated as independent due to unusual circumstances (like an abusive home situation). You can't declare yourself independent — only the school can grant this.

A student who is required to provide parent information on the FAFSA. Most undergraduate students under 24 who aren't married, don't have dependents, and aren't veterans are considered dependent — regardless of whether their parents claim them on taxes.

The system that automatically transfers your federal tax information from the IRS to your FAFSA. Previously called the IRS Data Retrieval Tool (DRT). You must consent to this during the FAFSA — declining makes you ineligible for federal aid.

A federal student loan made directly by the U.S. Department of Education. Includes Direct Subsidized Loans, Direct Unsubsidized Loans, Direct PLUS Loans (for parents), and Direct Consolidation Loans.

A federal loan for parents of dependent undergraduate students (Parent PLUS) or for graduate/professional students (Grad PLUS). Requires a credit check. Note: Grad PLUS loans are eliminated for new borrowers starting July 1, 2026.

A federal loan for undergraduate students with financial need. The government pays the interest while you're in school at least half-time, during your grace period, and during deferment. This is the best type of federal loan.

A federal loan available to all students regardless of financial need. Interest accrues from the day the loan is disbursed — including while you're in school. Available to both undergraduate and graduate students.

The process of paying financial aid funds to your school (which applies them to your account) or directly to you. Aid is typically disbursed at the start of each semester or term.

The OLD term for the amount a family was expected to contribute toward college costs. Replaced by the Student Aid Index (SAI) starting with the 2024-25 FAFSA. You may still see this term on older resources.

Free Application for Federal Student Aid. The form you fill out to apply for federal grants, loans, and work-study. Many states and schools also use your FAFSA data to award their own aid. It's free to file — never pay anyone to complete it.

Federal legislation that overhauled the FAFSA starting with the 2024-25 form. Reduced the number of questions, changed the need analysis formula, introduced the SAI, and changed how 529 plans and other assets are treated.

A federal grant for undergraduate students with exceptional financial need. Unlike loans, grants don't need to be repaid. The maximum Pell Grant changes annually. For 2026-27, students with an SAI above $14,790 are ineligible.

A unique 6-digit code assigned to each college that participates in federal student aid programs. You need this code to add schools to your FAFSA. Look them up at studentaid.gov.

A federal program that provides part-time jobs to students with financial need, allowing them to earn money to help pay for school. Not all schools participate, and funding is limited.

The difference between a school's Cost of Attendance (COA) and your Student Aid Index (SAI). Financial Need = COA - SAI. This number determines how much need-based aid you can receive from that school.

Your username and password for StudentAid.gov. Required to fill out the FAFSA, sign it electronically, and access your federal student aid information. Each person (student and each contributor) needs their own FSA ID.

A period after you graduate, leave school, or drop below half-time enrollment before you must begin repaying your federal student loans. For most Direct Loans, the grace period is 6 months.

Financial aid that does not need to be repaid (free money). Grants are typically awarded based on financial need. Federal grants include Pell Grants, FSEOG, and TEACH Grants. States and schools also offer grants.

A category of federal loan repayment plans that set your monthly payment based on your income and family size rather than your loan balance. Includes SAVE, PAYE, IBR, and ICR plans. Remaining balance may be forgiven after 20-25 years.

A student who does NOT need to provide parent information on the FAFSA. You qualify as independent if you're 24+, married, a graduate student, a veteran, have dependents, were in foster care, or meet other specific criteria.

The processed version of your FAFSA data that gets sent to the colleges you listed. Schools use the ISIR to determine your financial aid package.

The actual cost you pay out-of-pocket after all grants and scholarships are subtracted from the Cost of Attendance. Net Price = COA - Grants - Scholarships. This is the number you should compare across schools.

Federal legislation signed July 4, 2025 that made major changes to student aid for 2026-27: eliminated Grad PLUS loans for new borrowers, capped graduate loan limits, changed Pell eligibility, and excluded certain assets from the FAFSA formula.

A federal loan that parents of dependent undergraduate students can borrow to help pay for college. Requires a credit check. Being eliminated for new borrowers starting July 1, 2026, with legacy exceptions for current borrowers.

The tax year used for income data on the FAFSA, which is two years before the academic year. For the 2026-27 FAFSA, you use 2024 tax data. This gives families more time to file taxes before the FAFSA opens.

The authority of a school's financial aid administrator to adjust your FAFSA data or aid package based on special circumstances (job loss, medical expenses, etc.). You must contact the school directly and provide documentation.

Financial aid (free money) typically awarded based on merit, talent, or specific criteria rather than financial need alone. Scholarships come from schools, private organizations, employers, and community groups.

A number calculated from your FAFSA information that represents your family's financial strength. Replaced the EFC starting 2024-25. Can range from -1,500 to 999,999. Schools subtract your SAI from their COA to determine your financial need.

A summary of the information you submitted on your FAFSA, sent to you after processing (usually within 3-5 days). Includes your SAI. Review it carefully and correct any errors at StudentAid.gov.

Refers to loans where the government pays the interest during certain periods (while in school, grace period, deferment). Only available to undergraduate students with demonstrated financial need. Better than unsubsidized loans.

The gap between your financial need and the total aid offered. If your COA is $30,000, your SAI is $5,000 (need = $25,000), and you're offered $20,000 in aid, your unmet need is $5,000.

A process where your school confirms the accuracy of your FAFSA data by requesting supporting documents (tax transcripts, proof of identity, etc.). Being selected is random and doesn't mean you did anything wrong — just respond promptly.