Why Knowing Your Expected Family Contribution is Crucial

The Expected Family Contribution is arguably the most important number in college planning. This is the dollar amount that the schools and government expect a family to be able to afford a year for college.

This number is important because it will dictate if your family qualifies for need-based aid or not. This will help families on their college decision by finding out which schools offer the most generous need-based aid.

How this figure is calculated is by household income. The higher the income, the higher the EFC. Vice versa, the lower the income, the lower the EFC.

The EFC tends to increase $3,000 for every $10,000 of income. There is no cap on how high an EFC can go.

Some of the factors in determining a families EFC are:

1. Number of people in the household

2. Marital status of parents

3. Age of older parent

4. Number of children in college

5. Parent's adjusted gross income

6. Parent's income taxes paid

7. Student's adjusted gross income

8. Student's income taxes paid

9. Cash, savings, checking for parenting child

Knowing this figure is an important first step in the college planning process. Without knowing this number, the family is operating in the dark when it comes to finding the right school for the student!