New FAFSA earnings tool boosts transparency, but program costs and outcomes data still needed

On Monday, the U.S. Department of Education announced the launch of a new earnings indicator on the Free Application for Federal Student Aid (FAFSA) that provides students with information on the average post-graduation earnings at their selected schools. By flagging colleges where graduates, on average, do not earn more than typical high school graduates, this indicator will help students and families make more informed choices about which colleges to consider attending. The IHEP-led Postsecondary Data Collaborative has previously called on the Education Department to present College Scorecard earnings data on the FAFSA to help get that information directly to students. While the earnings indicator is an important step forward in providing transparency to students, it has limitations.  

The earnings are based on institution averages and the FAFSA information does not include costs and outcomes for specific programs of study. To help students decide which educational pathway best fits their goals, the Education Department should also move forward with releasing program-level data on costs and outcomes through the Financial Value Transparency framework.  

Here are the FAFSA changes that became effective on December 7, 2025: 

1. When students apply for federal financial aid, they select colleges that will receive their FAFSA. After completing the FAFSA, first-year undergraduate students will now see the following “lower earnings” disclosure in their FAFSA Submission Summary if one or more of their selected colleges has average earnings that are below those of the average high school graduate. 

2. Students can click on the notice to see earnings information for all the colleges they selected, as illustrated in the screenshot below. 3. Using this information, students can choose to remove one or more of their selected schools, add other institutions, or leave their FAFSA selections as is. 

4. Students who submitted their FAFSA forms before December 7 can also view their FAFSA Submission Summary to see whether any of their selected schools are flagged. 

This FAFSA indicator draws from College Scorecard data on the median earnings of undergraduates four years after graduation. Those average earnings are compared to the earnings of typical high school graduates in the same state or, if most first-year undergraduates are from other states or the institution has locations in multiple states, the national median. While earnings are not the only way to measure the value of postsecondary education and training, students deserve to know whether the colleges they’re considering consistently leave students worse off than if they had never attended.  

Nationally, about a quarter (23 percent) of institutions would be flagged. Those institutions enroll less than three percent of undergraduates and most are for-profit colleges that predominantly award certificates. The Education Department has posted a downloadable spreadsheet with the institution-level earnings data used for this indicator. 

While we applaud these steps to provide transparency to students on the FAFSA, we urge the Education Department to also publish program-level data on costs and outcomes through the Financial Value Transparency (FVT) framework and to maintain FVT in its rulemaking to implement the accountability provisions of the One Big Beautiful Bill Act.  

In its announcement about the new earnings indicator, the Department acknowledges, “Post-graduation earnings will vary by degree and program type, which are not reflected in the data presented.” To make informed college decisions, students need information about their likely earnings for specific programs of study, as well as how much they’ll pay for those programs. Along with their earnings after college, students’ investments in tuition, fees, and other costs of attendance are a crucial part of assessing their returns on investment from postsecondary education. 

Colleges have already reported program cost and other information to the Education Department as part of the FVT framework. When released as part of the FVT, the agency will make available for the first time many program-level data points, including costs, debt, and earnings across all types of colleges. But today, students and families can’t use this information because it hasn’t been published.  

The Education Department should build on the FAFSA earnings indicator and continue its commitment to transparency. Releasing FVT data as soon as possible will also help students better understand which programs deliver a strong return on investment when they are making decisions about where to apply.