When you start applying for financial aid to support your college studies, you’ll come across something that is puzzling for many families: the EFC. The abbreviation stands for Expected Family Contribution. It’s the part of the finances your family is expected to cover over one academic year and no financial aid program will pay for it.

But what does it mean, exactly, How do you calculate it? Are there any ways to reduce that part of the full cost so you can get more covered by financial aid?

Joanna Thomas, student advisor at Careers Booster, sheds some light on this issue: “There’s a specific formula that financial aid programs use to determine the expected family contribution for each applicant. It’s not a pre-set sum that your family has to meet. It’s an amount that varies and you can affect it in different ways.”

So let’s go through a list of 10 things you must know about the EFC so you’ll understand it and you’ll be able to influence it before applying for financial aid.

1. It’s Affected by Six Factors

The expected family contribution is calculated according to six major factors:

• The size of your family
• The assets of your family
• The taxed income for two years prior to your application
• The untaxed income for two years prior to your application
• Other family members who are going to attend college over the same academic year
• The family’s benefits

2. There’s an Average Sum

Those factors alone don’t help you figure out the EFC, right? An example might help. On average, an American household with adjusted gross income of $50,000 is expected to cover around $3K to $4K of the money needed for a year of college education for their son or daughter.

Needless to say, that amount will vary according to the other factors on the list above, but the income still is the major factor that scholarship programs take into consideration.

3. Families with Higher Income Have a Higher EFC

Naturally, if your household has a higher income, it’s expected to cover a larger part of your college expenses. This is a righteous system that’s supposed to help every student based on their need.

If, for example, your household income exceeds $80K, you might realize that you’re not eligible for need-based financial aid, unless there are several other family members going to college.

In this case, you’ll want to explore your options for need-based scholarships at private schools. Or you could aim towards merit-based scholarships.

4. You Can Get a Preliminary EFC

You can get an idea of how much this expected contribution will be before you even go to college. While you’re at high school, it will be good for your family to know how much your higher education will cost.

You can get a preliminary EFC estimation. The Federal Student Aid website gives you a FAFSA4caster tool, which will predict your eligibility for federal student aid. The expected family contribution will be part of the calculation.

5. There’s a Precise EFC Calculator, Too

If you’re only interested in the EFC sum, you can use a more precise calculator. College Board gives you a useful tool that takes different factors into consideration and gives you a precise estimation of the expected family contribution. Make sure to gather all information you need, and arm yourself with patience. The calculations will take a bit of time.

6. You Can Predict the Financial Aid If You Know the EFC

Now that you already know how to calculate the EFC, you can predict the amount of financial aid you’re going to get.

You’ll just take the total cost of attending your school for one year, and you’ll deduct the EFC from it. If, for example, you calculated that your EFC is $4K and one year at your school would cost $52K, this would be the calculation:

$52,000 – $4,000 = $48,000

That’s how much you can expect to get in the form of financial aid.

7. Expect to Cover More

The EFC is a predicted minimal amount of money that your family will need to cover. Keep in mind that in reality, families pay a bit more. Most programs don’t meet 100% of the student’s demonstrated need for financial aid. It’s important for families to be prepared for that fact, so they can start saving up money as soon as possible. Families can get an idea about the amount of financial aid they will receive from a specific college by filling out the net price calculator at each of the colleges the student is considering. 

8. Your EFC May Change

You may calculate your EFC during your early years at college, but keep in mind that this won’t be a fixed amount. The EFC may change if your family situation changes. If one of your parents lose their job or need special care, that factor will have a major influence over the sum. Death, separation, and divorce also influence the amount of money a family is expected to pay for the child’s education.

9. The Student Aid Report Will Include the EFC

Once you complete your FAFSA and the board evaluates it, you will receive your Student Aid Report. This report will include the EFC amount at the top right corner.

10. The EFC Is Lower If You’re Independent

If you are not dependent upon your family, you’ll be expected to cover less of the expenses for college. Instead of including your parents’ household and financial information, you’ll be only entering yours (and your spouse’s in case you have one).

FAFSA will ask specific questions to determine whether you’re independent or not. Once you reach 24 or you marry at a younger age, you’ll have greater chances to meet the requirements for Independent status.