Hundreds of articles have been written that recommend gaming the FAFSA by appearing to have fewer financial resources than you do to get more aid. We don't recommend you do this.
Aside from the ethical and legal aspects of shifting assets and income to manipulate the system, almost anything you do to affect your Estimated Family Contribution (EFC) will have an impact on your personal income, assets, and taxes.
What about shifting assets?
For example, you may decide to spend all your personal savings on a new car, hoping this would lower your EFC by lowering your assets.
But would spending $40,000 on a car mean your child would get $40,000 more in financial aid? No. Only a portion of parent assets are counted in the financial aid formula.
Common sense principles
The following common sense principles will affect how financial aid works for your family. Following them should keep you from having a higher EFC than you should.
Don’t be embarrassed to share your financial information. Some families are embarrassed to reveal financial information to a total stranger, but this kind of pride could cost you. While financial aid calculations seem very mechanical and pre-determined, they are not. Your financial aid administrator is a professional who can can strongly influence the process.
If you have suffered a setback, let your financial aid officer know. He or she might be able to modify the results of the financial aid calculations.
The bottom line: Financial aid administrators are there to help and can save you money if you let them.
Best advice for a low EFC
Don't waste time with strategies that may result in tiny increases in financial aid and that, at worst, could result in fines or jail time. Instead, focus on getting your taxes done early and accurately.