Posted on July 19, 2015 in Government Grants
The United States Federal Government awards several types of grants to students who need help funding their college education. Probably the most common and most well-known of these federal government grants is the Federal Pell Grant program. This program is designed especially to help financially disadvantaged young people be able to attend college. Federal Pell Grants are thought of as the foundation of your financial aid program, and other grants and scholarship and loans are then added on top of the Federal Pell Grant to complete the package.
The Federal Pell Grant program dates back to the 1970s, when they were called the Basic Education Opportunity Grant Program. In 1980, the name of the program was changed to Pell Grants to honor Senator Claiborne Pell, a Democrat from Rhode Island who sponsored vital education funding bills during his Senate career that lasted for six terms. Ever since, Federal Pell Grants have played an important role in helping generations of Americans attend college who otherwise would not have been able to afford it.
Unlike a loan, a Federal Pell Grant does not have to be repaid after you graduate. They are usually only given to undergraduate students who have not yet earned a bachelor’s or professional degree. (In some cases, student enrolled in a post-baccalaureate teacher certification program might receive Federal Pell Grants.)
You are not eligible to receive a Federal Pell Grant if you are incarcerated in a federal or state penal institution. You can only receive Federal Pell Grants from one college or university at a time, and there is a limit to how many Federal Pell Grants you can be awarded. You can receive them for no more than 12 semesters (about six years).
The amount of money you can get from a Federal Pell Grant changes every year. For the 2015-2016 award year, the maximum grant awarded is $5,775. The actual amount you get will depend on the following factors:
- Your financial need (based on your Expected Family Contribution – EFC)
- Your cost of attendance
- Whether you are a full-time or part-time student
- Whether or not you plan to attend school for a full academic year
Your Expected Family Contribution (EFC) is the amount that the federal government determines that you and your family can contribute to your college education each year. This number is arrived at using data from the FAFSA that you fill out, including information from your tax return. The most important of those numbers are your income and assets or your parents’ income and assets, your family’s household size and the number of family members attending college.
Unlike other grants, if you are eligible for a Federal Pell Grant you will definitely receive the full amount you qualify for, no matter how many other students also qualify. Every participating school receives enough funds from the U.S. Department of Education to pay all the Federal Pell Grants for its students. Other aid that students qualify for does not affect the amount of their Federal Pell Grants.
If your parent or guardian served in the U.S. Armed Forces and died as a result of military service in Iraq or Afghanistan after September 11, 2011, you may be eligible for more Federal Pell Grant funds if you were less than 24 years old and enrolled in college at least part-time when your parent or guardian died. If you are eligible, your Expected Family Contribution will be reduced to zero for the calculation, meaning you will get a higher grant amount.
Getting Your Grant Funds
If you are determined to be eligible for a Federal Pell Grant, you will get the funds directly from your college – not from the federal government. Your school can just credit the funds to your account to cover the costs of tuition, fees, room and board. They can also pay you directly or use a combination of these two methods.
Your college must also notify you in writing of the amount of your Federal Pell Grant. They must pay the funds out to students at least once per term (semester, trimester or quarter).
Federal Pell Grants used to be funded through Congress’ annual appropriations process, but since those funding decisions were only made once a year before schools came in session, funding was either too much or too little. In 2007 and again in 2010, the funding structure was changed to help account for shortfalls from the old method and to award more money per year to students.
You May Be Eligible
While the Federal Pell Grant program is typically thought of as strictly for low-income families, because of the way the grants are calculated, that is not always the case. Families with a large household size and more than one dependent child in college at the same time are also given consideration. It is definitely possible to qualify for a Federal Pell Grant with an income of more than $75,000. Do not skip filling out the FAFSA just because you think you make too much money.
Also, don’t forget that your eligibility or the amount of money you receive might be dependent on the college you are trying to attend. Federal Pell Grant amounts are different depending on the total cost of your college education.
In 2014, the total amount of Federal Pell Grant funding was $32.2 billion, so this is a massive program with a lot of support behind it. If you would like to get an estimate of how much you might be eligible to receive from a Federal Pell Grant, look for a good Pell Grant calculator online.
The bottom line is that while Federal Pell Grants will not fund your entire college experience, they are certainly a wonderful foundation on which to build your entire financial aid package. Apply for them each year by filling out a new FAFSA.
Federal Pell grants are an example of the best kind of government grants and financial aid for college – the kind you do not have to pay back. Take advantage and check out the Federal Pell Grant program today!