How often do FAFSA rules change? Worried about 529 plans and future policy shifts

FAFSA has historically had major overhauls every 5-7 years, with smaller tweaks happening almost annually. The recent FAFSA Simplification Act that changed the grandparent 529 rules was part of the biggest overhaul in over a decade. The changes to the SAI formula (which replaced EFC) and removing the sibling discount were huge shifts. Generally speaking, once they make a major change like this, they let it run for several years before another major overhaul. That said, financial aid policy can change with congressional action, so it's impossible to predict with 100% certainty. Your best bet is to make financial decisions based on current rules while staying somewhat flexible.

I've been working with financial aid for 15+ years, and I can tell you that while FAFSA rules do change, they rarely change in ways that completely reverse previous strategies. The grandparent 529 change was actually something advocates had pushed for many years. The most stable aspects tend to be: - What counts as an asset (real estate, investments, businesses) - Parent vs. student contribution ratios - Treatment of retirement accounts (protected) The areas that change more frequently: - Income protection allowances (usually these increase) - Verification requirements - Procedural aspects of filing For your 529 situation specifically, the change to not count grandparent distributions is likely permanent. Congress recognized this was unfair to families and aligned with their goal of simplification.

OMG I'm in the exact same boat! My son is a sophomore and I'm trying to figure out if I should put money in my name or his grandma's name and everyone gives different advice! The whole system is so frustrating!!! WHY can't they just keep things the same so we can plan????

I wouldn't worry too much about the grandparent 529 change - that one was a long time coming and makes logical sense. What I'd be more concerned about is the income protection allowances and contribution percentages. Those can change and have a much bigger impact. FAFSA rules typically change when: 1. New administration/Congress wants to make their mark 2. Economic conditions change drastically 3. There's public pressure about college affordability I'd guess we won't see another massive overhaul until at least 2027-2028, given how much trouble they had implementing this last one.

I've been trying to reach someone at Federal Student Aid for WEEKS to ask similar questions about future policy changes. Constant busy signals and disconnects when I finally got through! I finally used Claimyr (claimyr.com) to get connected to an actual human at FSA. They have this service where they wait on hold and then call you when they get a real person. Saved me hours of frustration! You can see how it works in their video demo: https://youtu.be/TbC8dZQWYNQ The agent I spoke with said that while small administrative changes happen annually, the major policy shifts like the treatment of grandparent 529s typically remain stable for several years after implementation. They're still dealing with the fallout from the FAFSA Simplification Act rollout, so more big changes are unlikely in the immediate future.

To answer your question directly - yes, it worked great for me. I was skeptical at first but after wasting literally hours trying to reach someone, it was worth it. They called me back with an actual FSA agent on the line within about 35 minutes.

The most significant FAFSA changes typically align with Higher Education Act reauthorizations, although those haven't followed a consistent schedule recently. The grandparent 529 change was actually delayed multiple times before implementation. In my experience advising families, I recommend making decisions based on current rules but maintaining some flexibility. For example: 1. Grandparent 529s are now advantageous and likely to remain so 2. Parent assets will continue to be assessed at around 5.64% (now part of SAI calculation) 3. Student income will always be assessed more heavily than parent income 4. Retirement accounts will remain protected One approach is to make 80% of your decisions based on current rules, with 20% flexibility for potential changes. The worst strategy is paralysis by analysis - not saving at all because you're worried about rule changes.

ppl act like theres some grand strategy to fafsa but its all political tbh. whatever party is in power changes the rules to match their agenda. if you want to predict future changes just look at who might be in office when ur kid applies lol

To address your question about grandparent 529s specifically - yes, that change is likely permanent. The old rule (counting distributions as student income) was widely criticized for years as unfair and counterproductive. Even if other aspects of FAFSA change, this particular improvement is unlikely to be reversed. The SAI formula might see tweaks to percentages or allowances, but the core structure is likely to remain for at least 4-5 years given how much effort went into implementing it. One thing to watch for is potential changes to institutional methodology (CSS Profile) used by private schools, which can differ from FAFSA. Some schools still treat grandparent 529 distributions differently than FAFSA does.

wait i thought the fafsa was totally changing again next year?? my neighbor said they're changing the whole system again in 2025 and we'll have to learn everything over??

Thanks everyone for the insights! It sounds like the consensus is that while minor adjustments happen regularly, major overhauls like the one that changed the grandparent 529 rules are less frequent, especially right after implementing such significant changes. I feel more confident continuing with our current plan of having my parents contribute to their 529 for my daughter. I'll also make sure to look into how CSS Profile schools might treat these assets differently since some of her target schools might use that. It's really helpful to hear from people who've navigated this system longer than I have. The 80/20 approach of planning based on current rules while maintaining some flexibility makes a lot of sense for us.

Great summary of the discussion! I'm glad you found the perspectives helpful. One additional tip as you move forward - consider setting up a simple spreadsheet to track any FAFSA rule changes that might affect your situation over the next few years. Even minor tweaks to income protection allowances or asset assessment rates can add up. Also, since your daughter is a freshman in high school, you have time to potentially test different strategies. For example, you could see how a small distribution from the grandparent 529 affects your practice FAFSA calculation in her junior year, giving you real data before making bigger decisions for her senior year applications. The fact that you're thinking about this now puts you way ahead of most families who don't start financial aid planning until the last minute. Keep staying informed, but don't let the uncertainty paralyze your planning efforts!