Financial Need and Expected Family Contribution (EFC)
Aid for most federal programs is awarded based on financial need
(except for unsubsidized Stafford Loans and PLUS Loans).
The EFC is a measure of your family’s financial strength
and indicates how much of your and your family’s financial
resources (for dependent students) should be available to help
pay for your education. EFC is calculated from the information
you report on the FAFSA.
Your EFC is calculated according to a formula established by
law. Your family’s income (taxable and untaxed), assets and
benefits (for example, unemployment or Social Security) are
all considered in determining your EFC. Your family size and
the number of family members who will be attending a college
or career school are also considered. Your EFC will appear
on the Student Aid Report (SAR) you receive after you file
To determine your financial need for our other federal student
aid programs (except for an unsubsidized Stafford Loan), your
school will subtract from your cost of attendance the following:
- the EFC,
- any Federal Pell Grant amount you’re eligible for, and
- other financial aid you’ll receive.
The balance, after your school subtracts from the cost of
attendance your EFC, your Federal Pell Grant and any other
financial aid you will be receiving, is your remaining need for
other financial aid, including other federal aid.
HOW MUCH AID CAN I GET?
Because the EFC formula must be
applied to each family’s financial
information, we cannot tell you
here whether you will be eligible
for federal student aid or estimate
how much aid you might get. You
must apply for financial aid to find
out what you qualify for.
After you get your SAR, contact the financial aid office at the
school(s) you’re considering (or the school you’ll be attending)
for more information on your student financial aid eligibility.
If you want to see how the EFC formula works, you
can get detailed worksheets from our Web site at
www.studentaid.ed.gov/pubs. Click on the year under
“The EFC Formula.” You can also get these worksheets by
contacting the Federal Student Aid Information Center at
The financial aid administrator at each school that offers
you admission puts together a financial aid package that
comes as close as possible to meeting your financial aid needs.
However, because most federal student aid funds are limited,
the total amount awarded to you might fall short of the amount
for which you’re eligible. Also, except for Federal Pell Grant aid,
the amount of federal student aid you receive is affected by other
sources of aid you might get, such as scholarships and state aid.
Each school you apply to will send you a notice of the types and
amounts of aid you’re eligible for.
If you’re eligible for financial aid, the financial aid office at each
school will send you an award letter outlining the amount and
type of student financial aid available from all sources. Review
the award letters you receive from all schools to compare the
amounts and types of aid that will be available at each school.
I think I have some special circumstances
in my family. Are these considered in
determining my financial needs?
The EFC formula is basically the same for all applicants, but there
is some flexibility. Your financial aid administrator can adjust the
cost of attendance or the information used to calculate your EFC
to take into account your special circumstances. These circumstances
could include your family’s unusual medical expenses,
tuition expenses or unemployment.
The financial aid administrator
must have compelling reasons
to use professional judgment to
make adjustments because of special
circumstances. You will have to provide
adequate documentation to support
any adjustments. The financial aid
administrator’s decision as to whether
you have special circumstances is final and can’t be appealed to us.
Excerpted from Funding Education Beyond High School: The Guide to Federal Student Aid 2006-2007, available at http://studentaid.ed.gov