The shrinking paychecks and job losses of 2020 could prove a bit helpful now, as college students and families make a pitch for financial aid for the 2022-23 school year.
Smaller incomes, after all, could mean a better shot at more financial aid. But if you saw big gains picking stocks and day trading online last year, well, you'll have to take that money into account, too.
The kickoff is Oct. 1 for the first chance to file the Free Application for Federal Student Aid application — commonly called FAFSA — for the academic year that begins in the fall of 2022.
As part of the application process, you'd use the 2020 federal tax return.
The earlier you file, the better your odds of receiving financial aid. Filing early also helps high school seniors better review the financial aid packages from various colleges.
Even so, many do not jump on the chance to get the ball rolling.
Instead, half of families who filed the FAFSA for this academic year dragged their feed and filed sometime from January through April in 2021, according to the annual "How America Pays for College" report from Sallie Mae, a major lender of private student loans. The spring survey includes undergraduates in college and parents with college students.
Waiting, though, could cost you money because some scholarships and other financial aid are first come, first served.
When it comes to covering college tuition, you first want to bring money to the table through part-time jobs, savings, gifts from family, grants and scholarships.
And then, you want to max out on what's available for federal student loans. Federal student loan rates are low and you may later qualify for some benefits, such as income-driven repayment plans and some loan forgiveness programs.