What Is a High Student Aid Index?

To qualify for federal student aid, you must first submit the Free Application for Federal Student Aid (FAFSA). Once complete, you’ll receive a FAFSA Submission Summary within one to three business days, which will include your Student Aid Index (SAI). 

The SAI ranges from -1,500 to 999,999. Colleges use it to assess your eligibility for financial aid. If you have a high Student Aid Index, it may lower the amount you qualify for. In this article, we’ll explore exactly what a “high” Student Aid Index looks like and how it shapes your financial aid package.

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What is a high Student Aid Index?

The numbers in the Student Aid Index (SAI) have an inverse relationship with financial need. In other words, a lower SAI means you have greater financial need, while a higher SAI means you have lower financial need. 

It’s important to note that a higher Student Aid Index number relates to eligibility based on financial need. It’s not an award amount or financial aid offer. A high Student Aid Index typically means that you won’t qualify for certain types of need-based aid, such as Pell Grants. 

“A high Student Aid Index indicates to schools that a family could have more capacity to pay, which can reduce or eliminate need-based aid, such as scholarships, grants, and subsidized loans,” says Becca Craig, a certified student loan professional (CSLP) and certified financial planner (CFP) at Focus Partners Wealth. 

How is the SAI calculated?

The way the Student Aid Index is calculated is determined primarily by your dependency status. Three formulas for SAI exist for:

1. Dependent students
2. Independent students with no dependents besides a spouse
3. Independent students who have dependents aside from their spouse 

All of the formulas use the following elements:

• Annual income
• Financial assets
• Family size 

The SAI calculation for dependent students uses financial information from the student and their parents. The formula accounts for basic living expenses, which reduce total financial resources, before determining the level of financial need.  

If you and/or your parents have a higher annual income and more assets, the SAI may be higher and reduce your level of financial need. 

“Eligibility for need-based financial aid is based on the difference between the annual cost of attendance (tuition, fees, housing, meals, books, supplies, equipment, transportation, and miscellaneous personal expenses) and the SAI,” explains Mark Kantrowitz, a college financing expert and author of books on the subject. “Thus, a higher SAI reduces eligibility for need-based financial aid.”

Why do some families have a high Student Aid Index?

Some families may have a higher Student Aid Index for various reasons. These can include:

• Higher income: Having a higher annual income could result in a high Student Aid Index, as it demonstrates more resources and less need. 
• More financial assets: Your checking and savings accounts, certificates of deposit, money market funds, cash, stocks, bonds, and mutual funds contribute to your total assets and net worth. Investment properties do as well, but your primary residence does not. 
• Smaller family size: If you have a smaller family size, that could bump up your SAI. In general, financial resources are spread out more for people with larger families. However, the “sibling discount” that was available with the Expected Family Contribution (which the SAI replaced) is gone, which could ultimately lead to less aid. This discount offered a break in the financial aid formula to families with multiple children in college. 

“Even when income feels stretched in real life, the calculation leans heavily on assets and all sources of reported earnings (including interest, capital gains, investment dividends), so the system assumes less support from the institution to pay for college is needed,” says Craig.

How does a high SAI affect financial aid eligibility?

It’s essential for families with a higher income and assets to understand the impact of a high SAI on financial aid. Generally, a high SAI lowers the likelihood of qualifying for need-based aid, such as grants and subsidized loans. 

According to a Student Aid Index fact sheet from the Department of Education, an SAI from -1,500 to 0 has the highest likelihood of qualifying for the maximum federal Pell Grant award. 

Grants are a type of financial aid that typically doesn’t need to be repaid. Subsidized loans come with an interest benefit, where the government covers any unpaid interest while you’re in school, during your grace period, and during any deferments. However, just because a student doesn’t qualify for need-based aid doesn’t mean they don’t qualify for any aid. 

“A student with a very high SAI is still eligible for unsubsidized federal Direct Stafford Loans, parent PLUS loans, and merit-based aid,” says Kantrowitz, author of “How To Appeal for More College Financial Aid.” He notes that some forms of state aid may also be available if they don’t depend on the SAI or Pell Grant eligibility.

While your SAI may affect certain types of aid, it doesn’t mean you’re ineligible for everything. You may also qualify for institutional aid, depending on your school’s criteria. 

“Institutional aid can be based on far more factors than just the SAI,” says Jack Wang, a college financial aid adviser at Innovative Advisory Group and host of the Smart College Buyer podcast. “Colleges can consider things like major, gender, geographic origin, and just about anything else. It's their money, so they get to set the rules.”

How can students with a high SAI improve their aid prospects?

If you have a high Student Aid Index, you have some options to improve your chances of getting additional aid, including: 

• Maximize scholarships: Apply for a range of scholarships based on your grades, achievements, and abilities. 
• Consider an appeal: “File a financial aid appeal with the college if there are special circumstances, such as a change in income from the ‘prior-prior year’ or anything that differentiates the family's financial circumstances from the typical family (e.g., high unreimbursed medical expenses, high dependent care costs for a special needs child or elderly parent),” says Kantrowitz. 
• Compare college costs: Kantrowitz recommends enrolling in a lower-cost college, such as an in-state public college. “The goal should be on maximizing aid, which is not the same as lowering SAI,” Wang adds. As part of that process, Wang says, “Families should look for colleges that really want their students, not just who will accept their students. And understanding what a college really wants, not what they are willing to accept, can lead to far more aid than what they may get from lowering SAI.”