College financial aid can feel like one of the most confusing—and important—aspects of the college planning process. At the heart of that process is a new formula that’s changing how need-based aid is awarded: the Student Aid Index (SAI).
If you’ve heard of the Expected Family Contribution (EFC), the SAI is its replacement. Understanding how it works, how it’s calculated, and what it means for your financial aid eligibility is crucial for families who want to avoid overpaying for college.
In this article, we break down what the Student Aid Index is, how it affects financial aid, and what families can do to improve their financial outlook before filing the FAFSA.
Understanding the shift from EFC to SAI
For years, the Expected Family Contribution (EFC) was the number used by colleges to estimate a family’s ability to pay for college. In 2024, the EFC was replaced with the Student Aid Index (SAI) as part of major federal financial aid changes aimed at making the process more transparent and equitable.
While the name has changed, the purpose remains the same: SAI is used to determine a student’s eligibility for federal financial aid. But the formula behind it and how it’s applied are different—and that difference could impact how much aid a family receives.
To learn more about the background of this change, see our detailed overview: What Is the Student Aid Index and How Is It Calculated?
What is the Student Aid Index (SAI)?
The Student Aid Index (SAI) is a number used by the federal government and many colleges to estimate a family’s financial strength and determine eligibility for need-based financial aid.
Key facts about the SAI:
- It’s calculated when a family completes the FAFSA (Free Application for Federal Student Aid)
- It can range from -1,500 to over $100,000
- A lower SAI means greater demonstrated financial need
- It is not the amount your family will pay for college—it’s a tool used to calculate aid
The formula determines how much financial aid a student may qualify for by subtracting the SAI from a college’s cost of attendance (COA):
Cost of Attendance – SAI = Financial Need
This makes understanding your SAI essential to building a realistic financial plan for college.
How is SAI calculated?
SAI is calculated using information you provide on the FAFSA. It takes into account:
- Parent and student income (adjusted gross income and untaxed income)
- Parent and student assets (excluding retirement accounts and home equity)
- Household size
- Number of students in college at the same time
The FAFSA uses IRS data and a standardized federal formula to determine the SAI. Notably, it differs from the old EFC formula in several key ways:
- It allows for a negative number, indicating extremely high need (as low as -1,500)
- It removes the number of students in college as a factor in dividing parental contribution, which may reduce aid for some families
Let’s compare two hypothetical families:
Family A earns $45,000 per year with no reportable assets. Their SAI might be around $500, making them eligible for significant Pell Grant and institutional aid.
Family B earns $120,000 with $50,000 in non-retirement assets. Their SAI might be closer to $18,000, meaning they qualify for less need-based aid and may need to rely on merit scholarships or financial planning strategies.
For more details, visit the Federal Student Aid SAI Overview.
SAI’s impact on financial aid offers
Your SAI plays a major role in determining how much aid your student may receive from both the federal government and individual colleges. Here’s how it works:
- Federal aid: The Pell Grant and other federal programs use the SAI to determine eligibility. The lower the SAI, the higher the potential grant.
- Institutional aid: Many colleges use SAI (or their own formula) to award need-based scholarships or tuition discounts.
- Financial gap planning: The difference between the COA and total aid offered is what families are expected to cover.
Remember: the SAI is not your final bill—it’s part of a formula. A high SAI does not always mean zero aid, especially at private colleges that offer generous institutional support.
What families can do to improve their financial position
Planning ahead is the best way to minimize your SAI and maximize aid.
Here are several legal, ethical strategies families use:
- Time your income: Avoid selling assets or taking retirement distributions during FAFSA filing years.
- Minimize reportable assets: Reduce student savings and keep parent assets in retirement accounts when possible.
- File the FAFSA early: Some aid is distributed on a first-come, first-served basis.
- Avoid financial aid myths: Don’t assume you won’t qualify—run a net price calculator for each college.
A professional college financial planner can help you apply these strategies. Learn more in our guide to The Power of a Personalized College Plan.
Common misunderstandings about the SAI
Families often misinterpret the SAI or assume it tells the whole story. Here are a few common myths:
“My SAI is my tuition bill.”
False. Your SAI is used to determine aid eligibility—not what you’ll actually pay.
“My high income means no aid.”
Not necessarily. Many families with incomes over $100,000 still receive aid, especially from private colleges with higher costs and larger endowments.
“Only federal aid uses the SAI.”
Many colleges also use the SAI as a baseline, though some apply their own formula through the CSS Profile or institutional aid programs.
“My SAI can’t change.”
It can. A change in income, family size, or assets could alter your SAI from year to year.
Understanding the SAI is just one piece of the larger financial aid puzzle.
Frequently Asked Questions About the Student Aid Index (SAI)
What’s the difference between the SAI and the old EFC?
The SAI replaces the Expected Family Contribution (EFC) as the metric used to determine financial aid eligibility. While both estimate a family’s ability to pay, the SAI allows for a negative number and removes some factors like multiple students in college.
Is my SAI what I’ll actually pay for college?
No. The SAI is not your out-of-pocket cost. It’s a number used to assess financial aid eligibility. Your actual cost depends on the college’s financial aid offer.
Can my SAI change from year to year?
Yes. Changes in family income, household size, or assets can impact your SAI each year when you file the FAFSA.
Do private colleges use the SAI?
Many do, though some use their own financial aid formulas or require the CSS Profile. Always check with each college to understand how they calculate need.
Should I still fill out the FAFSA if I think my income is too high?
Yes. Many families mistakenly assume they won’t qualify for aid. FAFSA opens the door to federal loans, some merit-based aid, and is often required by colleges for any financial consideration.
How CBRG helps families navigate the SAI and financial aid
At College Benefits Research Group, we help families:
- Understand how the SAI affects aid at different colleges
- Analyze real college costs after aid is applied
- Implement strategies to reduce financial burden and avoid excessive debt
Our experts provide side-by-side comparisons of aid offers, help interpret financial aid letters, and ensure families make informed decisions that align with long-term goals.
Find out how a college planning specialist can support your family through this complex process.
Be proactive and strategic about the SAI
The Student Aid Index is a critical factor in college affordability—but it doesn’t have to be a mystery. With the right knowledge and planning, families can make confident, informed choices about where to apply, how to file, and how to pay.
Start your financial aid planning early. Connect with CBRG to see how personalized strategies can improve your student’s college outcome—and reduce your financial stress.