Student-centric advice and objective recommendations
Higher education has never been more confusing or expensive. Our goal is to help you navigate the very big decisions related to higher ed with objective information and expert advice. Each piece of content on the site is original, based on extensive research, and reviewed by multiple editors, including a subject matter expert. This ensures that all of our content is up-to-date, useful, accurate, and thorough.
Our reviews and recommendations are based on extensive research, testing, and feedback. We may receive commission from links on our website, but that doesn’t affect our editors’ opinions. Our marketing partners don’t review, approve or endorse our editorial content. It’s accurate to the best of our knowledge when posted. You can find a complete list of our partners here.
Is There a FAFSA Income Limit?
By
Kayla Korzekwinski
Kayla Korzekwinski is a Scholarships360 content writer. She earned her BA from the University of North Carolina at Chapel Hill, where she studied Advertising/PR, Rhetorical Communication, and Anthropology. Kayla has worked on communications for non-profits and student organizations. She loves to write and come up with new ways to express ideas.
Learn about our editorial policies
Caitlyn Cole is a college access professional with a decade of experience in non-profit program and project management for college readiness and access organizations.
Learn about our editorial policies
Maria Geiger is Director of Scholarship Services at Scholarships360. She is a former online educational technology instructor and adjunct writing instructor. In addition to education reform, Maria’s interests include viewpoint diversity, blended/flipped learning, digital communication, and integrating media/web tools into the curriculum to better facilitate student engagement. Maria earned both a B.A. and an M.A. in English Literature from Monmouth University, an M. Ed. in Education from Monmouth University, and a Virtual Online Teaching Certificate (VOLT) from the University of Pennsylvania.
Learn about our editorial policies
Many families have the misconception that there are FAFSA income limits. The truth is that a student can qualify for federal financial aid even if their family has a high income. This is because financial need is calculated based on a variety of factors and because there is federal aid that isn’t based on financial need. Continue reading to learn more about FAFSA and income limits!
Importance of the FAFSA
The only way for a student to qualify for federal financial aid of any kind is by completing the FAFSA annually. Schools use the information from the FAFSA to determine a student’s financial aid package every year. The FAFSA gives you an idea of what type of aid you qualify for: some types are free money that you don’t need to pay back and others are loans that you do need to pay back. Completing the FAFSA allows students access to:
- Federal Pell grants
- Federal work-study programs
- Subsidized direct loans
- Unsubsidized direct loans
- Direct PLUS loans
Financial need only affects need-based grants, work-study, and Direct subsidized loans. Before writing it off, complete the FAFSA and you may be surprised!
Melody Lipford | Advising Specialist on the Virtual Access Team, College Possible
Expert Perspective
See also: How to renew your FAFSA
Need-based financial aid
Need-based financial aid is based on a student’s Student Aid Index (SAI). The SAI is calculated based on the information provided when you fill out the FAFSA. Your family’s untaxed income, assets, and benefits are all relevant factors in calculating your SAI. You can use net price calculators provided on each college’s website to give you a better idea of how much aid you might expect to receive.
The following types of federal financial aid are based on financial need:
Federal Pell Grants
Funds from Federal Pell Grants do not need to be repaid. These are an example of a FAFSA program that does have income limits. The government offers Federal Pell Grants to undergraduate students who show exceptional financial need. However, there is an annual maximum amount of funds a student can receive in the form of a Pell Grant.
2024–25 Award Year
The maximum Federal Pell Grant award is $7,395 (July 1, 2024, to June 30, 2025)
2025–26 Award Year
The maximum Federal Pell Grant award is $7,395 (July 1, 2025, to June 30, 2026)
You can receive the Federal Pell Grant for no more than 12 semesters or the equivalent of 6 years.
Federal work-study programs
Schools that participate in federal work-study programs base students’ eligibility for the program on financial need. Work-study allows students to work part-time, usually in their field of study, in exchange for federal funds. Hourly pay for work-study programs is at least minimum wage.
Direct subsidized loans
Direct subsidized loans are student loans that need to be repaid, and they are offered to students who show financial need. Subsidized loans do not accrue interest while the student is in school or during the grace period because the government pays it.
See also: All about subsidized vs. unsubsidized loans
There is also federal aid that is non-need-based and does not consider a student’s EFC.
Jack Wang | Wealth Advisor, Innovative Advisory Group
Expert Perspective
Non-need-based financial aid
This aid is calculated by subtracting all other forms of aid a student has received, including need-based aid scholarships, and private student loans. The remaining number is how much non-need-based aid a student is eligible for.
The following types of federal financial aid are not based on need:
Direct unsubsidized loans
Students can receive up to the school’s cost of attendance in Direct Unsubsidized Loans. The student will be responsible for paying the interest on these loans at all times.
PLUS loans
PLUS Loans are offered to graduate/professional students or to parents of dependent undergraduate students. The government offers these loans to cover gaps in financial aid. There is no financial need requirement for PLUS loans, but borrowers must not have adverse credit.
No FAFSA income limit
Many students do not fill out the FAFSA because they believe they won’t qualify for any aid. Again, there is no maximum income for federal student aid. Eligibility is based on more than just income. It considers EFC, which is based on factors such as the cost of the college, children in the family enrolled in college, family size, and other special circumstances.
Complete the FAFSA every year!
It is important to submit a FAFSA every academic year. This is because eligibility requirements change every year, as do the circumstances of a family. Don’t skip filling out the FAFSA, and don’t forget to apply for all the scholarships you qualify for!