EFC or the Expected Family Contribution is one of the most important aspects you need to consider — and properly calculate — if you are on a lookout for scholarships, grants, and other forms of financial aids. The EFC plays a very determining role in many of the available financial aid programs, because the EFC can generally be used to see the big picture of your current financial state.

If you studied how the federal government calculates EFC, you can easily spot that the index can actually be modified. Understanding how you can actively influence your EFC index will give you the chances to receive financial aids you desperately need.

The basic calculation of EFC is actually very simple. 20% of your assets and savings as well as 5.64% of your parents’ assets and savings are combined to generate the overall EFC amount. Anything under your or your parents’ name will be taken into the calculation. Now, most parents make the mistake of saving money for college using accounts under their children’s name. Since the accounts will be calculated as contributing bigger proportion to the education costs, your EFC number can easily get pretty high. Accounts and assets under grandparents’ names, however, are not considered part of the EFC equation.

Although your parents may be saving a lot of money for your educations, your family may not be as financially stable; you could really use financial aids to help finance the education, but EFC index being too high for the program will prevent you from getting one. This is exactly why influencing the EFC number actively is very important. You can study the average maximum EFC index allowed for many available financial aid programs, and then take the required steps to reduce your EFC index to that level.

Avoid placing too much savings or assets under your or your parents’ name, and actively balance the family’s overall financial state to keep the EFC index at the right and representative level. Advise your parents about the matter as well to make sure they are helping you with the process, and you will be influencing your EFC index in no time.

Gary Singh owns StudentFinAidInfo website providing free information on student financial aid, student loan consolidation, Pell grant eligibility, private student loans for bad credit, and expected family contribution.