FAFSA Income Protection Allowance

FAFSA does have a minimal income protection allowance. For parents, it tracks the federal poverty line fairly closely but has an additional variable of number attending college. For students, it’s a flat $6,420.

Here is the table from this year’s FAFSA for dependent students:

Note that the Income Protection Allowance goes down for each additional college student. Shouldn’t it go up since more students in college should yield more aid? Remember that you’re calculating EFC, Expected Family Contribution, not expected student contribution. So although you may have multiple students and each will have their own EFC calculated, the total parent contribution is then divided by the number of students in college to arrive at the “Parents’ Contribution.” Confused? Look at the Parents’ Contribution section on page 9 of the FAFSA Formula Guide here.

See The FAFSA Formula Explained for more.