Your Expected Family Contribution (EFC) is a measure of your family’s financial strength, used to determine your eligibility for need-based financial aid. It is calculated using a formula that considers your family’s income, assets, and other factors.
If your EFC is high, it means that your family is considered to be financially well-off, and you may not be eligible for as much financial aid as you need. This can be frustrating, especially if you come from a family that is struggling to make ends meet.
There are a few reasons why your EFC might be high.
- Your family’s income is high. The higher your family’s income, the higher your EFC will be. This is because the government believes that families with higher incomes can afford to pay more for college.
- Your family has a lot of assets. Assets include things like savings, investments, and real estate. The more assets your family has, the higher your EFC will be. This is because the government believes that families with more assets can afford to pay more for college.
- Your family has a lot of untaxed income. Untaxed income includes things like Social Security benefits, child support, and alimony. The more untaxed income your family has, the higher your EFC will be. This is because the government believes that families with more untaxed income can afford to pay more for college.
If you think your EFC is too high, you can appeal it. The appeal process can be complex, but it is worth it if you think you are eligible for more financial aid.
Here are some tips for appealing your EFC:
- Gather documentation. You will need to provide documentation to support your appeal. This documentation can include things like tax returns, bank statements, and investment statements.
- Write a letter. In your letter, you should explain why you think your EFC is too high. You should also provide evidence to support your claims.
- Submit your appeal. You can submit your appeal online or by mail. The deadline for appeals is typically May 1st.
If your appeal is successful, your EFC will be lowered. This could make you eligible for more financial aid.
How to lower your EFC
There are a few things you can do to lower your EFC.
- Increase your family’s expenses. This can be done by things like paying off debt, contributing to a retirement account, or making charitable donations.
- Decrease your family’s income. This can be done by things like working less hours, taking a pay cut, or starting a business.
- Transfer assets to your children. This can be done by things like setting up a trust or giving your children gifts.
It is important to note that these strategies can have negative consequences. For example, increasing your family’s expenses can reduce your savings, and decreasing your family’s income can make it more difficult to pay your bills. You should carefully consider the pros and cons of each strategy before making a decision.
Conclusion
If you are concerned about your EFC, you should talk to a financial aid counselor. They can help you determine if you are eligible for financial aid and can help you develop strategies for lowering your EFC.
