College prices can be alarming, but most students pay less than the published price once grants and scholarships are counted. Getting the most aid starts with understanding how it’s calculated and applying on time. Several federal rules changed in 2026, so even families who’ve been through the process before should take a fresh look.
Step 1: File the FAFSA
The Free Application for Federal Student Aid is the gateway to federal grants, loans and work-study, and most states and colleges use it for their own aid too. The 2027–28 FAFSA, for students starting or continuing college in fall 2027, opened ahead of October 1, 2026.
- It uses 2025 tax information, pulled directly from the IRS with your consent.
- It calculates your Student Aid Index (SAI), a number colleges use to determine your eligibility for need-based aid.
- It’s easier for returning students, with some answers carried over from the previous year, and parents with more than one child applying can reuse their information.
- File early. Some state and college aid is first come, first served, and state deadlines vary.
What changed in the aid formula
- Farm and small business assets: the net worth of family farms, family-owned businesses with 100 or fewer full-time employees, and family commercial fishing businesses no longer counts. For some families, that means a lower SAI and more aid.
- Pell Grant limits: students whose SAI is at least twice the maximum Pell Grant are not eligible for Pell, regardless of other factors. For 2026–27, that threshold is $14,790.
- Full scholarships: students whose other grants and scholarships already cover the full cost of attendance are not eligible for Pell.
- Foreign income: any foreign earned income excluded from U.S. taxes is now added back when determining Pell eligibility.
Grants: free money first
- Federal Pell Grants: up to $7,395 for 2026–27 for students with financial need, based on the SAI.
- Workforce Pell: since July 1, 2026, Pell Grants can also help pay for approved short-term job training programs lasting 8 to 15 weeks, in fields identified by each state.
- State grants: many states offer generous grants with their own deadlines and residency rules.
- College grants and scholarships: the largest source of aid at many private colleges, based on need, merit or both.
The CSS Profile
Some private colleges and scholarship programs also require the CSS Profile, run by the College Board, to award their own aid. It asks for more detail than the FAFSA, such as home equity at some colleges, and some colleges require information from both parents if they’re separated or divorced. Fee waivers are available for eligible families.
Loans: how much, and from whom
| Loan | Who borrows | Limits |
|---|---|---|
| Direct Subsidized and Unsubsidized | The student | For dependent students: $5,500 in year one, $6,500 in year two, $7,500 in later years, up to $31,000 in total. Unchanged. |
| Parent PLUS | A parent of a dependent student | For new borrowers since July 1, 2026: up to $20,000 a year and $65,000 in total per student |
| Private loans | Student, often with a cosigner | Set by the lender, based on credit |
Families who already had Parent PLUS loans for a student enrolled before July 1, 2026 may be able to continue under the old rules for a limited time. New Parent PLUS loans also have fewer repayment options than before, with no access to income-driven repayment. A combined lifetime limit of $257,500 now applies to a student’s own federal loans across undergraduate and graduate study, not counting Parent PLUS.
Comparing offers
Aid offers aren’t standardized, so line them up carefully:
- Separate free money from loans. Grants and scholarships don’t need to be repaid; loans and work-study are different.
- Calculate net cost: total cost of attendance minus grants and scholarships.
- Check renewal conditions, such as minimum GPA requirements for merit scholarships.
- Look four years ahead. Tuition usually rises, and some aid is only for the first year.
Appealing an offer
If your family’s situation has changed since the tax year the FAFSA uses, such as a job loss, medical expenses or divorce, ask the financial aid office for a professional judgment review. Provide documentation and be specific. Some colleges will also reconsider merit aid when you share a stronger offer from a comparable college, though policies vary.
Other ways to lower the cost
- In-state public universities and colleges known for meeting full need
- Community college, then transfer. See our transfer guide
- Credit you’ve already earned through AP, IB or dual enrollment
- Direct admissions and state scholarship programs. See direct admissions explained
- Outside scholarships, especially local ones with fewer applicants
Our cost planner estimates your borrowing and any remaining gap, and our guide to fee waivers covers the cost of applying.