How Would a Gap Year Affect Financial Aid and FAFSA?

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High school graduates are increasingly taking a year off from school before starting college. According to The Hechinger Report, about 16% of high school seniors in 2020 intended to take a gap year before starting college. This unusually high percentage reflects many learners’ hesitance to begin college online during the COVID-19 pandemic.

The pandemic makes some gap-year activities challenging, but successful planning can help learners maximize this time. The U.S. government recently increased its national service opportunities, which provide great experiences for gap-year learners.

Some postsecondary students also take a break from college due to life circumstances. These students may plan to return at a more convenient time. Use this guide to learn more below about gap-year pros and cons, including potential financial aid issues.

What Is a Gap Year?



Once mostly reserved for the wealthy, a gap year traditionally entailed a “Grand Tour” of European cultural centers. According to the Gap Year Association, the modern gap-year harkens back to post-World War II Britain. It refers to when 18-year-old men served for two years in the armed forces before returning to school.

The gap-year tradition also derives from admission timelines at England’s top universities, Oxford and Cambridge. Historically, most British colleges admitted applicants based on their July exams. However, Oxford and Cambridge applicants had to stay in school for an extra trimester. They also had to take an Oxford entrance exam in December and wait to start school until the following fall. These elite students could spend the interim nine months in various ways.

Today, many students take a gap year to work, travel, or volunteer. Some students take a college gap year because it can improve maturity and enhance academic performance. Others use the time to earn money for college.

What Are the Pros and Cons of Taking a Gap Year?



College gap years offer various costs and benefits. Gap-year students may perform better academically and possess greater maturity than students who don’t take a gap year. However, research indicates that gap-year students lose an average of $90,000 in income. These learners also fall out of step with their peers by starting college later. Learn more about gap-year advantages and disadvantages below.

Pros of Taking a Gap Year

Get Real-Life Experience
Many gap-year participants engage in work, internship, or volunteer experiences that build professional skills. Gap years can also provide experiential learning opportunities that enhance the college experience. The Gap Year Association runs many accredited gap-year programs.
Make Your Resume Stand Out
Many students use a gap year to pursue unique internship, volunteer, or work experiences. These experiences can bolster a resume, giving college and job applicants a competitive edge.
Meet New People
Many students meet lots of new people during their gap year. This can lead to professional and academic networking opportunities. International and multicultural gap-year experiences can also expose participants to diverse perspectives that enrich their lives.

Cons of Taking a Gap Year

Losing Academic Momentum
Some students who take a gap year never go back to college. Life can take unexpected turns during the course of a year. High school graduates may get caught up in work or family obligations that interfere with going back to college.
Starting College Later Than Peers
Taking a gap year often means starting college at 19 or 20 years old, which makes gap-year students older than many of their peers. This age gap might lead to friends of gap-year students graduating and starting their careers sooner than gap-year students.
Increasing Your Expenses
Many high school graduates planning to work before college also move away from home and purchase a car. Renting an apartment and making vehicle payments proves costly. These expenses can make returning to school difficult.

Gap Year Students and College Admissions



The Gap Year Association recommends that gap-year students apply to college as high school seniors. Working on college applications while in high school makes obtaining guidance counseling and letters of recommendation easier.

Once accepted, students can request an enrollment deferral. Deferment means that the school holds a spot for the student the following year. Students considering a gap year should make sure that prospective colleges allow deferment. Deferral policies vary by school, but deferment usually requires students to pay a deposit to hold their spot.

To defer enrollment, the accepted student writes a deferral letter. This letter makes a formal request to the prospective college to hold the student’s place. Deferral letters should explain the reasons for deferral and how that decision will make the student a strong learner. The deferral letter also details what the student plans to do during the gap year. Planning some activities relevant to college can improve students’ odds of receiving deferral.

Since data indicates that gap-year students perform better in college than students who don’t take a gap year, many schools grant deferral requests. The Gap Year Association offers a list of affiliated schools and gap-year programs. Some schools allow gap-year students to defer their financial aid package, including scholarships. Schools may also offer special scholarships or additional financial aid to gap-year applicants.

Gap Year Students and Financial Aid



Current and prospective college students should understand how taking a gap year can impact their finances. College gap-year procedures vary by school, so applicants and current enrollees considering taking a break from college should review their schools’ policies before taking time off.

  • Q. Will I Lose My Financial Aid if I Take a Gap Year?

    Taking a gap year may affect financial aid offerings. Many schools and government programs disburse financial aid annually based on the funding supply and demand for that year. Since the financial landscape changes each year, schools and programs cannot guarantee that financial aid applicants will qualify for the same package the following year.

    However, a gap year can make applicants more attractive scholarship candidates. So, some applicants improve their scholarship prospects by taking a gap year.

  • Q. Should I Fill Out the FAFSA If I'm Taking a Gap Year?

    Applicants planning to take a gap year should submit the FAFSA when first applying to college and then resubmit the FAFSA the year they plan to return to school. Students who worked during their gap year often report higher incomes than they had while in school. This higher income figure can lower financial aid awards.

  • Q. Will a Gap Year Affect My Student Loans?

    Some college students take a semester or two off after starting college, rather than prior to it. These learners usually return to school at a more convenient time. However, taking a break from college can affect both federal and private loan payment schedules.

    Federal loans usually require repayment starting six months after students leave school. Consequently, gap-year students may need to start paying off their loans about six months after taking a break from college. Deferred private loans may also require payments soon after leaving school. In some cases, student loan recipients can apply for longer deferment periods due to extenuating circumstances. However, private loans continue accruing interest year-round.

Federal loans usually require repayment starting six months after students leave school. Consequently, gap-year students may need to start paying off their loans about six months after taking a break from college. Deferred private loans may also require payments soon after leaving school. In some cases, student loan recipients can apply for longer deferment periods due to extenuating circumstances. However, private loans continue accruing interest year-round.” } }] }

Applying for the FAFSA



A financial aid application for prospective college students, the FAFSA allows the government and prospective schools to connect qualifying students with financial aid opportunities. Financial aid packages may include subsidized and unsubsidized loans, scholarships, and grants. Some students also secure work-study opportunities through the FAFSA.

All students should submit the FAFSA. Even students who do not expect to receive financial aid usually need to submit a FAFSA to provide a financial profile to prospective schools. Many scholarship applications also require FAFSA submission.

Federal financial aid eligibility depends on students’ enrollment status, cost of attendance (COA), and expected family contribution (EFC). Students’ school-year level also influences eligibility. Financial aid offices often calculate financial aid award amounts by subtracting the applicant’s EFC from their COA.

To complete the FAFSA, applicants must include their Social Security or alien registration number. Other items needed are federal income tax returns and W2 forms. They also need to include include bank statements, investment records, and records of untaxed income. Submission deadlines vary by school and state, so applicants should check deadlines for their school and their state. To maximize financial aid eligibility, applicants should submit the FAFSA online in January.

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