1. Chuck Moore, CCFC, CAMC, CAFC Louisville, Kentucky 502-721-8646 ▪ tuition2@insightbb.com www.collegeliteracyacademy.com www.gearuped.com

2. How To Complete The FAFSA

37. How The EFC Is Calculated

38. FAFSA Formula Similar To Tax Formula Income Protection Allowance Asset Protection Allowance Employment Allowance Deductions For Certain Taxes Paid

39. Income Protection Allowance Family size Number in college 12345 2$17,100$14,170 321,29018,38015,450 426,29023,37020,46017,530 531,02028,10025,19022,26019,350 636,29033,36030,45027,53024,620 Parents of Dependent Students

40. Income Protection Allowance Example Number In Household4 Number In College1 AGI:$85,000 Income Protection Allowance$26,290 Available Income$58,710

41. Asset Protection Allowance

42. Asset Protection Allowance Example Oldest Parent46 Allowance$37,100 Exposed Assets$50,000

43. Asset Protection Allowance Example Oldest Parent46 Exposed Assets $50,000 Allowance (minus) $37,100 $12,900 $12,900 X 5.65% Adjusted Available Assets$729 ($729 Is Added Into Your Adjusted Available Income)

44. Employment Allowance Example Number Of Parents Working 2 Lowest Earner Amount$26,000 Employment Allowance %35% Maximum Allowance$3,500 (Single Wage Earners Do Not Get An Employment Allowance)

45. Employment Allowance Example Number Of Parents Working 2 Lowest Earner Amount$26,000 Employment Allowance %X 35% $9,100 Maximum Allowance$3,500 (Single Wage Earners Do Not Get An Employment Allowance)

46. Employment Allowance Example Number Of Parents Working 2 Lowest Earner Amount$7,000 Employment Allowance %X 35% $2,450 Maximum Allowance$2,450 (Single Wage Earners Do Not Get An Employment Allowance)

47. Tax Allowance Example Federal Taxes $ 5,250 Social Security Taxes$ 6,120 State Taxes 4%$ 3,200 Total Tax Allowance$14,570

48. Total Allowance Income Allowance $26,290 Asset Allowance $ 729 Employment Allowance$ 3,500 Tax Allowance$14,570 Total Allowances$45,089

49. Adjusted Available Income Of Parents Total Income $85,000 Total Allowances-$45,089 Adjusted Available Income $39,911

50. Adjusted Available Income Of Parents If AAI is—Then the contribution is— Less than −$3,409−$750 ($3,409) to $15,30022% of AAI $15,301 to $19,200$3,366 + 25% of AAI over $15,300 $19,201 to $23,100$4,341 + 29% of AAI over $19,200 $23,101 to $27,000$5,472 + 34% of AAI over $23,100 $27,001 to $30,900$6,798 + 40% of AAI over $27,000 $30,901 or more$8,358 + 47% of AAI over $30,900

51. Adjusted Available Income Of Parents Available Income$39,911 Adjustment Factor- 30,901 Adjustment Factor Left$ 9,010

52. Adjusted Available Income Of Parents First $30,901 Assessed$8,358 Second $9,010 Assessed 47%+4,235 EFC Of Parents$12,593

53. Student’s EFC First $6,130 - $0 (50% thereafter minus taxes) Assets 20% (No Asset Protection Allowance)

54. Student’s EFC Student’s Income $ 3,850 Student’s Assets$10,000

55. Student’s EFC Student’s Assessment From Income $3,850 - $6,130 = $0 Student’s Assets $10,000 X 20% = $2,000 Students EFC = $2,000

56. Total Family’s EFC Parents’ EFC$12,593 Student’s EFC+ 2,000 Family’s EFC$14,593

57. Student’s Financial Need Total Cost Of Attending$18,000 EFC Of Family- 14,593 Financial Need$ 3,407

58. Student’s Attends Private University Total Cost Of Attending$38,000 EFC Of Family- 14,593 Financial Need$23,407

59. BIG PROBLEM How Is This Family Going To Pay Their Expected Family Contribution Of $14,593 This is 14% of Gross Income or; 17% of Net Income After Taxes

60. Chuck Moore, CCFC, CAMC, CAFC Louisville, Kentucky 502-721-8646 ▪ tuition2@insightbb.com www.collegeliteracyacademy.com www.gearuped.com