RESTON, Va., Jan. 4, 2010—Attention families planning to send a student to college next fall: the financial aid application, which typically ranks up there with visiting the dentist and paying taxes as Americans’ idea of a good time, is getting easier to complete. Sallie Mae, the nation’s leading saving, planning and paying for education company, reminds students and families to file the FAFSA beginning Jan. 1 to not miss out on financial aid for college.

Why is the Free Application for Federal Student Aid, or FAFSA, important? The federal government, state governments and college each use this form to make need- and non-need-based grants, scholarships, work-study and federal student loans. In fact, Uncle Sam will award at least $168 billion in student aid based on the information on the FAFSA. It is available online at www.fafsa.gov.

“Students and parents often call Sallie Mae feeling very overwhelmed and confused as they try to fill out the FAFSA form,” says Tara Zielinski, a customer service representative at Sallie Mae Pennsylvania. “It is important for students and families to know that I am one of many here to help them to get through the financial aid process.”

Applicants will see slightly fewer questions in 2010, plus an easier online process. Also newly in place is an instant estimate of Pell grant and student loan eligibility. Previously, students had to wait for weeks to receive notification.

During these tough times, more families need financial aid and more students enroll in school. In fact, 16 million people have submitted the FAFSA already through the third quarter of 2009, up from the previous year.

Nevertheless, many are still missing out on aid. According to a national study from Sallie Mae and Gallup, How America Pays for College, 24 percent of families did not complete the FAFSA last academic year. Submitting it early, every year a student is in college, and before state and college deadlines maximizes a student’s chances to receive grants and scholarships.

For 2010-2011, the FAFSA can be completed anytime after Jan. 1 before the end of the academic year, but many institutions and states have deadlines in February and March. With some colleges and states allocating finite—or shrinking—funds, it is wise to complete the FAFSA as early as possible.

While the FAFSA exercise determines a financial aid package for one year, Sallie Mae’s free Education Investment Planner helps families plan their budgets for a full degree program. College-bound students and their parents can use this tool to estimate the total cost of a college degree, build a plan to pay for college without going beyond their means, and, if loans are part of the plan, calculate the starting salary a graduate would need to keep payments manageable. Visit www.SallieMae.com/invest for more information.

Sallie Mae recommends the “1-2-3 approach” to paying for college: first, use free money by filling out the FAFSA to access need-based grants and research and apply for scholarships, supplemented with current income and savings. Second, explore federal loans. Available to both students and parents, they can offer low, fixed interest rates and flexible repayment options. Third, fill any gap by using a pay-interest-as-you-go private education loan. For example, Sallie Mae’s Smart Option Student Loan ensures that what a student originally borrowed is all he owes at graduation.

Note to editors and reporters: Visit Sallie Mae's newsroom for additional FAFSA resources.