The Expected Family Contribution (EFC) is a crucial figure in the financial aid process as it helps determine your eligibility for need-based scholarships, grants, and loans. It is an estimate of the amount your family can contribute towards the cost of attending college or university. In this article, we will walk you through the process of calculating your EFC.

Step 1: Gather Necessary Information

To calculate EFC accurately, you need to collect relevant financial information for both the student and their parents.

This information includes:

1. Adjusted Gross Income (AGI)

2. Taxable Income

3. Non-taxable Income

4. Assets such as savings, investments, and other property

5. Benefits such as unemployment compensation, Social Security, and child support

6. Number of family members attending college

Step 2: Complete the Free Application for Federal Student Aid (FAFSA)

You can apply for financial aid by completing the Free Application for Federal Student Aid (FAFSA) on the FAFSA website or through the myStudentAid mobile app. The FAFSA form asks questions about your family’s financial situation and uses that information to calculate your EFC.

Step 3: Understand the Components of the EFC Formula

The EFC formula considers three factors when calculating your EFC:

1. Parent Contribution (PC): This is based on your parents’ income, assets, and benefits minus allowances like taxes and living expenses.

2. Student Contribution from Income (SCI): This is based on your income and benefits minus educational expenses.

3. Student Contribution from Assets (SCA): This is based on a percentage of your assets that you are expected to contribute to your education.

Step 4: Calculate Your Expected Family Contribution

To calculate your EFC, follow these steps:

1. Determine your family’s total income, which includes AGI, taxable income, non-taxable income, and benefits.

2. Subtract allowances (like taxes and expenses) to obtain the available income.

3. Based on the available income, use the EFC formula chart provided by the U.S. Department of Education to determine your parent contribution (PC).

4. Calculate your student contribution from income (SCI) by subtracting educational expenses from your income and benefits.

5. Calculate your student contribution from assets (SCA) by taking a percentage of your assets.

6. Add PC, SCI, and SCA to get the total Expected Family Contribution.

Conclusion

Calculating EFC is an essential step in understanding your financial aid eligibility for college or university. By following these steps, you’ll be able to estimate your EFC, helping you make an informed decision about the affordability of attending a particular college or university. Keep in mind that each institution may have additional methods for awarding financial aid and may consider other factors as well. It’s always a good idea to reach out to the college’s financial aid office with any questions related to your specific situation or their financial aid policies.