Pell Grants 101: Everything You Need to Know

Financial aid comes in many different forms: need-based scholarships, grants, work study and loans. All of these components work together to make attending college an achievable dream for every student. Like scholarships, grants do not have to repaid, and students can qualify for grants from a variety of sources. Grants can be awarded by the federal and state governments, colleges and public or private organizations. Oftentimes, grant money fills the gap between the sticker price of a college and what a family can realistically pay.

Pell Grants 101: Everything You Need to Know

Whether or not you’ve done any research into financial aid, you may have heard of the Federal Pell Grant program. It is frequently brought up in political debates as candidates advocate for the decrease or increase of funds to the program. With that, the Pell Grant is a federally funded grant program that has been around since 1965. Fortunately, the program today is bigger than ever, in dollars awarded and students helped. Take a look at the Pell Grant and how it could potentially help you pay for college.

What is the Pell Grant?

The Pell Grant is a federally funded grant that is available to undergraduate students. It is typically awarded to students that demonstrate exceptional need based on the family’s ability to pay for college. This means that primary recipients of the Pell Grant are typically low-income students. Historically, the Pell Grant has aimed to help low-income students turn the dream of attending college into a reality. Naturally, in low- socioeconomic circumstances, attending college can seem like an impossibility. The goal of the Pell Grant is to encourage and then provide financial support for students that may have difficulty paying for college in any capacity. Because of this, the Pell Grant has been responsible for increasing college enrollment and has been attributed to enhancing student retainment. When students have the security of financial help, they are more likely to attend – and stay in college.

How do I get a Pell Grant?

Students can reach Pell Grant eligibility the same way they would any other form of financial aid: by filling out the Free Application for Federal Student Aid (FAFSA). The FAFSA is available for students to begin filling out on October 1. It is recommended that students complete the FAFSA as soon as possible, given that much of financial aid is distributed on a first-come, first-serve basis. However, the FAFSA does have an 18-month application cycle and can be submitted as late as June 30 the following year it is released. The FAFSA will ask about both the student and parents’ financial circumstances and use that information to determine the Expected Family Contribution (EFC). Typically, a student’s income and assets, parents’ incomes and assets, family household size and number of family members attending college at the same time, are taken into account in order to determine EFC. This is why it’s important to complete the FAFSA every year; any – or all – of the above circumstances can change within a given school year. Once the EFC is determined, the student will receive a Student Aid Report (SAR) or the school will receive an Institutional Student Information Record (ISIR). Either of these will notify the student – or the institution – if he or she qualifies for a Pell Grant.

How much is the Pell Grant?

The amount a student can receive in their Pell Grant can change annually, according to studentaid.gov. For the 2022 – 23 award year, though, the maximum amount a student can obtain is $6,895. It should also be noted that there is a maximum amount of Pell Grant aid that can be distributed per student over their lifetime. Federal law limits it to six years of Pell Grant funding over a student’s lifetime, as stated by studentaid.gov. As part of his college affordability plan, President Biden announced in March that he would like to increase the maximum Pell Grant amount. Under his proposal, the Pell Grant would increase to $8,670 for for the 2023 – 24 school year. Just like your family’s financial circumstances determine whether or not you even qualify for the Pell Grant, they also control exactly how much you receive. Additionally, cost of attendance, full- or part-time student status, and whether or not you plan to attend for a full academic year, are taken into account. The Pell Grant can be disbursed to a student in a variety of ways. Students have the option of Pell Grants going directly toward their tuition bill, in the form of a check to themselves, or a combination of both methods.

What student costs does my Pell Grant cover?

Finally, Pell Grants can help to cover a myriad of student expenses: • Tuition and fees • Books, supplies, transportation and personal expenses • Living expenses, like room and board • Dependent care (i.e. day care) for a student with dependents If you have a question about whether your Pell Grant covers a specific aspect of your education, talk to a financial aid administrator at your school. In fact, if you have any questions about the Pell Grant at all, your financial aid office should be your first point of contact. They can walk you through the application process via the FAFSA, help you best allocate your Pell Grant funds, and provide advice as you navigate the program through your college years.