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It’s time to talk about the FAFSA, five little letters that are sure to strike fear into the hearts of parents with a college-bound junior or senior at a terror level that’s worse than Caller ID indicating you’re being contacted by the billing department at the hotel that just hosted Missy’s high school volleyball team.

For the benefit of those not being sucked into the mind-numbing maw of the college-industrial complex, the FAFSA is the mandated Free Application for Federal Student Aid. Filling out the form is, according to most parents, not quite as much fun as slamming your hand in a car door for an hour. Then you do it again every year until the kid graduates and comes back to live in your basement, where he helpfully rearranges the furniture into the ancient Inca patterns he learned in “Anthropology of Lost Cultures.”

But there is some good news on the FAFSA front: starting next year it will be easier to fill out and a lot more poor kids won’t be locked out of getting a higher education. And everyone else could get a lot more time to shop and compare schools and aid offers to make sure they’re choosing a college they can afford and getting as much financial help as possible.

The bad news is that the formula used to calculate how much cash families can afford to fork over remains stuck between “ludicrous” and “indentured servitude.”

The timing gets better

The FAFSA is used for two things: Qualifying for federal aid, such as Pell Grants, and as a common form that nearly all colleges use to calculate the aid students get from the school.

The FAFSA problems being fixed are two major ones. The first was that parents had to use their prior year’s tax information when filing, but colleges typically wanted the FAFSA filed by Feb. 15, when many parents were still waiting for their tax records. That meant parents had to estimate their financial information, get an aid offer, then submit the actual tax results and hope that wouldn’t cause the aid to be reduced or withdrawn.

Now families will be able to file in October, when the college hunt typically begins for seniors. Even better is that families will be able to use the tax data they filed for the year before (known as “the “prior prior year”) and the online IRS Data Retrieval Tool can grab the needed information and automatically fill it into the FAFSA form.

Hurdles of FAFSA

This is good news, says Patrick O’Connor, associate dean of college counseling at Cranbrook Kingswood School in Bloomfield Hills, past president of the National Association for College Admission Counseling, and author of “College Is Yours 2.0.” He’s also my brother, so he has to explain these things to me, or else he doesn’t get invited to Thanksgiving.

“Many families try to file the FAFSA but it’s too big a hurdle. As a result, they don’t file the FAFSA and they decide college is too expensive,” Dr. Pat says. “They stop the college search at that point.”

According to the college financing site Edvisors.com, for the 2011-12 school year, 2 million undergrads who could have gotten college aid didn’t file, missing out on as much as $12.4 billion in grants and aid, including $9.5 billion in Pell Grants. The majority of students getting those grants come from households making less than $30,000 a year.

Another benefit, according to Dr. Pat, is that the new FAFSA filing date may (and really should) encourage colleges to start making their own aid offers earlier. Right now, families don’t get their aid offers until sometime after March 1, often well after college application deadlines. Then the schools want an answer — and a non-refundable tuition deposit — by May 1.

“That gives most students less than a month to sort out financial aid offers from a lot of schools,” Dr. Pat says. If the earlier FAFSA date prompts schools to move up admissions and aid decisions, “It’s going to give them more time to make a decision about college costs.”

There’s a movement to either eliminate the FAFSA, by using only information filed with the IRS, or to reduce it to a two-question test that’s very nearly as accurate as the current version with 105 questions and 88 pages of instructions. Either fix is sorely needed, but what’s absolutely vital is to revise the math that calculates how much money families are expected to contribute toward the insane cost of college.

I hit a couple of cost calculators at both private and public schools, to see how much I’d have to contribute to higher educate my boy, Funny Money Jr. or, as I call him, Li’l Money (’cuz that’s all his college will leave us). They seem to think I can afford $28,000 a year, which I can, as long as Mrs. Funny Money and I sell the house and live under the kid’s dorm room bed.

So, when it comes time to send the boy off to the ivy-covered halls, I’ll definitely be filling out a FAFSA. Along with a whole bunch of lottery slips.

Brian O’Connor is author of “The $1,000 Challenge: How One Family Slashed Its Budget Without Moving Under a Bridge or Living on Government Cheese.”

boconnor@detroitnews.com

Twitter: @BrianOCTweet

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