Personal Finance
FAFSA rollout is on track despite issues, Education Department says
The “phased rollout” of the new Free Application for Federal Student Aid is on track for the upcoming academic year, the U.S. Department of Education says.
So far, the 2025-26 FAFSA has been available to limited groups of students in a series of beta tests that began on Oct. 1. It will become available to all students and contributors on or before Dec. 1, the Education Department said. (Typically, all students have access to the coming academic year’s form in October, but last year’s new simplified form wasn’t available until late December after a monthslong delay.)
“I am confident we will able to launch next year’s form by December 1,” James Kvaal, Under Secretary of Education, told CNBC.
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Yet there are still “many unresolved problems,” some of which also plagued last year’s college aid application cycle, according to higher education expert Mark Kantrowitz.
As of Oct. 29, the government’s FAFSA Issues page lists 22 unresolved issues, down from 25 a few weeks ago, he said.
Last year, some high school seniors said complications with the new form weighed heavily on their decisions about college.
“We’ve heard from a lot of students and families that were frustrated,” Kvaal said. “We’ve made a lot of progress resolving those issues and we are now seeing more students able to complete their form.”
The FAFSA’s impact on college choices
For many students, financial aid is crucial when it comes to covering the cost of college.
Higher education already costs more than most families can afford, and college costs are still rising. Tuition and fees plus room and board for a four-year private college averaged $58,600 in the 2024-25 school year, up from $56,390 a year earlier. At four-year, in-state public colleges, it was $24,920, up from $24,080, the College Board found.
The FAFSA serves as the gateway to all federal aid money, including federal student loans, work-study and especially grants — which have become the most crucial kind of assistance because they typically do not need to be repaid.
Submitting a FAFSA is also one of the best predictors of whether a high school senior will go on to college, according to the National College Attainment Network. Seniors who complete the FAFSA are 84% more likely to enroll in college directly after high school, according to an NCAN study of 2013 data.
Freshman enrollment is down
In part because of issues with the new form, the number of new first-year college students sank 5% this fall compared with last year, according to an analysis of early data by the National Student Clearinghouse Research Center.
The declines in first-year student enrollment were most significant at four-year colleges that serve low-income students, the report also found. At four-year colleges where large shares of students receive Pell Grants, first-year student enrollment sank more than 10%.
The steep drop was “shocking,” particularly at schools that serve a high share of lower-income student said Ellie Bruecker, director of research at The Institute for College Access and Success.
“It’s a very big deal to see that level of decline,” she added.
Bruecker also said she expects the Education Department will be able to meet the deadlines that they’ve set for the the 2025-26 form.
But even if all goes well, students are still working within a condensed time frame compared to the typical October FAFSA rollout, which may be to their disadvantage, she added.
“Even if everything goes smoothly this time, we are still working on a shorter time line — it’s cutting off two to three months,” she said. For families and students dependent on financial aid, “that could feel very stressful.”
Home Alone (1990)
20th Century Fox
The classic Christmas movie “Home Alone” tells the improbable tale of a family who leaves their 8-year-old son home when they leave for vacation.
Yet in the years since the 1990 film was released, viewers have focused on another question — how wealthy was the fictitious McCallister family featured in the movie?
The family orders 10 pizzas on the eve of their trip, lives in a house that can sleep 15 people (including extended family) and all fly to Paris for the Christmas holiday.
“They’re well off and in a good place financially,” Cody Garrett, a certified financial planner, owner and financial planner at Measure Twice Financial in Houston, said of the first impression of the McCallisters’ circumstances.
But the family may not be quite as wealthy as they seem, Garrett said.
To better understand the details of the McCallister family’s financial circumstances, Garrett recently did a deep dive analysis of the family’s finances from “Home Alone” and “Home Alone 2: Lost in New York,” which debuted in late 1992, and hosted a webinar with around 25 financial planners to discuss financial planning opportunities that arise in the movies.
Both movies were shot long before social media made it popular to flaunt personal wealth online. Nevertheless, the lifestyle the McCallister family shows to the world may not necessarily be an indication of their wealth, Garrett said.
“There’s a lot of things that are showing that they spent a lot of money, or at least financed a lavish lifestyle to the public,” Garrett said. “But inside their own home, they’re actually maybe a little scared about money.”
What the McCallister lifestyle would be worth now
The Home Alone Experience created by Disney+, opens in London, offering an immersive experience inspired by the Christmas movie, with set recreations of the McCallister family’s home.
David Parry Media Assignments | PA Wire | AP
What looked lavish more than 30 years ago when the first two movies were shot is now even more luxurious today, thanks in large part to the effects of inflation.
The actual five-bedroom, six-bathroom Winnetka, Illinois, home where the movie was filmed was listed for $5.25 million in the spring. Today, it is still under contract, and a final sale price won’t be known until the deal is finalized, according to Zillow spokesperson Matt Kreamer.
To buy the house at $5.25 million today would cost approximately $34,000 per month, with principal, interest and property taxes, according to Kreamer. That’s with 20% down and a 7% mortgage rate.
To comfortably afford the home, you would need $100,000 per month in income, assuming you’re adhering to an affordability threshold of not spending more than one-third of your income on housing costs, Kreamer said.
“It’s a pretty spectacular house, and certainly one of the more famous movie homes that people can instantly recognize,” Kreamer said.
In 1990 when the first movie debuted, the home would have likely been worth a little less than $1 million, Kreamer estimates, which is still high for that time.
Yet the home may not necessarily point to a high net worth for the McCallister movie family.
“I would not be surprised if they don’t have much equity in their house,” Garrett said, given the couple’s stage of life and circumstances.
In the films, the McCallisters are also driving what at the time were relatively new cars — a 1986 Buick Electra Estate Wagon and a 1990 Buick LaSabre — each of which would be valued at $40,000 in today’s dollars, according to Garrett’s estimates.
While the family is eager to show their wealth — including mother Kate paying in cash for the $122.50 pizza bill while also offering a generous tip — they’re frugal when it comes to the things people don’t see, Garrett said.
How the family talks about money can sometimes point to a scarcity mindset, he said. For example, Kate mentions she doesn’t want to waste the family’s milk before they leave on vacation.
The family’s lifestyle isn’t paid for all on their own. Peter’s brother Rob actually foots the cost of the Paris trip for the family. That airfare would cost around $55,650 today, GoBankingRates recently estimated.
What financial planning lessons are hidden in the movie
Many major details about Kate and Peter McCallister’s finances are not disclosed, including what they do for a living.
Nevertheless, the financial planners who evaluated the family’s circumstances saw some holes that could be addressed with planning.
On the top of their wish list: proper insurance coverage.
Because Kate and Peter McCallister have five children, having enough life and disability insurance should they pass away or become unable to work should be a top priority to ensure their dependents are provided for, according to Garrett.
The movie — which includes many slips and falls at the family’s home as 8-year-old Kevin tries to ward off a pair of robbers — also signals a need for an umbrella insurance policy, in case the McCallisters are found liable for injuries or damages that occur.
Kate and Peter — who forget or lose their son Kevin in both of the first two “Home Alone” movies — would also be wise to make proper estate planning arrangements in the event they can no longer provide or care for their children. That includes having wills, powers of attorney, advance directives, beneficiary designations, trusts and proper account titling, all kept up to date.
The couple should name physical and financial guardians who can care for the children. They may also establish a pre-need guardian for the children who can step in if the parents are unable to care for them even for a short period of time, said Aubrey Williams, financial planner at Open Path Financial in Santa Barbara, California.
“If the parents are not there to take care of the kids, there’s the possibility that kids, even if briefly, will become a ward at the state because there’s no one to care for them,” Williams said.
After a strong start to the holiday season, consumer spending is on track to reach record levels this year. But many of those purchases will soon be returned.
December’s peak shopping days are closely followed by the busiest month for sending items back, which experts dub “Returnuary.”
This year, returns are expected to amount to 17% of all merchandise sales, totaling $890 billion in returned goods, according to a recent report by the National Retail Federation — up from a return rate of about 15% of total U.S. retail sales, or $743 billion in returned goods, in 2023.
Even though returns happen throughout the year, they are much more prevalent during the holiday season, the NRF also found. As shopping reaches a peak, retailers expect their return rate for the holidays to be 17% higher, on average, than usual.
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“Ideally, I hope there is a world in which you can reduce the percent of returns,” said Amena Ali, CEO of returns solution company Optoro, but “the problem is not going to abate any time soon.”
How returns became an $890 billion problem
With the explosion of online shopping during and since the pandemic, customers got increasingly comfortable with their buying and returning habits and more shoppers began ordering products they never intended to keep.
Nearly two-thirds of consumers now buy multiple sizes or colors, some of which they then send back, a practice known as “bracketing,” according to Happy Returns.
Even more — 69% — of shoppers admit to “wardrobing,” or buying an item for a specific event and returning it afterward, a separate report by Optoro found. That’s a 39% increase from 2023.
Largely because of these types of behaviors, 46% of consumers said they are returning goods multiple times a month — a 29% jump from last year, according to Optoro.
All of that back-and-forth comes at a hefty price.
“With behaviors like bracketing and rising return rates putting strain on traditional systems, retailers need to rethink reverse logistics,” David Sobie, Happy Returns’ co-founder and CEO, said in a statement.
What happens to returned goods
Processing a return costs retailers an average of 30% of an item’s original price, Optoro found. But returns aren’t just a problem for retailers’ bottom line.
Often returns do not end up back on the shelf, and that also causes issues for retailers struggling to enhance sustainability, according to Spencer Kieboom, founder and CEO of Pollen Returns, a return management company.
Sending products back to be repackaged, restocked and resold — sometimes overseas — generates even more carbon emissions, assuming they can be put back in circulation.
In some cases, returned goods are sent straight to landfills, and only 54% of all packaging was recycled in 2018, the most recent data available, according to the U.S. Environmental Protection Agency.
Returns in 2023 created 8.4 billion pounds of landfill waste, according to Optoro.
That presents a major challenge for retailers, not only in terms of the lost revenue, but also in terms of the environmental impact of managing those returns, said Rachel Delacour, co-founder and CEO of Sweep, a sustainability data management firm. “At the end of the day, being sustainable is a business strategy.”
To that end, companies are doing what they can to keep returns in check.
In 2023, 81% of U.S. retailers rolled out stricter return policies, including shortening the return window and charging a return or restocking fee, according to another report from Happy Returns.
While restocking fees and shipping charges may help curb the amount of inventory that is sent back, retailers also said that improving the returns experience was a key goal for 2025.
Now 33% of retailers, including Amazon and Target, are allowing their customers to simply “keep it,” offering a refund without taking the product back.
For shoppers, return policies are key
Increasingly, return policies and expectations are an important predictor of consumer behavior, according to Happy Returns’ Sobie, particularly for Generation Z and millennials.
“Return policies are no longer just a post-purchase consideration — they’re shaping how younger generations shop from the start,” Sobie said.
Three-quarters, or 76%, of shoppers consider free returns a key factor in deciding where to spend their money, and 67% say a negative return experience would discourage them from shopping with a retailer again, the NRF found.
A survey of 1,500 adults by GoDaddy found that 77% of shoppers check the return policy before making a purchase.
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