If you’ve completed the FAFSA before, you’re probably familiar with the EFC, or Expected Family Contribution. Beginning with the 2024-2025 school year, the EFC will be replaced by the Student Aid Index (SAI). Similar to the EFC, the SAI is calculated using the information you provide on the FAFSA, but there are important updates. For example, students from lower-income families might now receive a negative SAI that goes below zero, whereas the lowest possible EFC in the past was zero.
The SAI is determined using a formula that evaluates a family’s income, assets and benefits—essentially, it’s the information you provided on the Free Application for Federal Student Aid aka, the FAFSA®. The SAI is an index number that will be used by your prospective schools to determine your financial aid package. Your SAI is only considered in need-based financial aid.
Cost of Attendance and Determining Financial Aid
Every year, each school is tasked with determining their students’ financial aid packages. This may involve comparing the financial need of all their students. The SAI helps a school determine the student’s financial need and their eligibility for not only federal aid, but also institutional and state aid.
Before the amount of financial aid can be determined, the cost of attendance for your school must first be evaluated to fully understand how much money is needed. The cost of attendance (COA) is an estimate of books, course materials, supplies, and equipment, as well as cost of housing and food, transportation expenses, federal student loan fees, allowance for childcare or other dependent care, costs related to a disability, costs of obtaining a license, certification, or first professional credential, and reasonable costs for eligible study abroad programs. as well as books and supplies and other applicable expenses. The COA is determined by your school for your specific program and enrollment. As you plan your expenses for the upcoming year, you can find COA information on your school’s website.
Need-based financial aid is based on your financial need and the income information provided on the FAFSA. Your financial need is determined by subtracting your SAI from your school’s COA. Your financial aid eligibility is based on your financial need, and income information.
In the past, families believed that the EFC is the amount you are required to pay for college. That wasn’t true, and will continue to be untrue with the switch to the SAI. You aren’t required to pay your SAI out of pocket, you can use a variety of financial aid options like loans, private scholarships, college savings plans, etc. In addition, there is no guaranty that your prospective school will offer you financial aid up to your SAI, and you may owe your school more than your calculated SAI.