The Pell Grant

A Pell Grant is a subsidy that U.S. federal government provides for students who need it to pay for college. Basically, these are grants, unlike loans do not have to be repaid. Eligible students receive a specified amount each year under this program. The whole purpose of the Pell Grant Program is to provide money to pay college tuition for students whose family has a low income. These federally funded grants help about 5.4 million full-time and part-time college and vocational school students nationally.

Pell Grants were created by the Higher Education Act of 1965. These federal funded grants are not like loans and need not be repaid. Students may use their grants at any one of approximately 5,400 participating postsecondary institutions.


Federal Pell Grants are the largest source of federally funded grants, so chances are good that if you are eligible, you’ll receive some federal aid.

  • The Department of Education has a standard formula that it uses to evaluate the information that each person supplies when applying for the Pell Grant. The formula produces a number that is called the Expected Family Contribution (EFC), which determines the student’s eligibility.
  • This grant requires each applicant to be an undergraduate student who has not yet earned a bachelor’s degree, and a United States citizen or an eligible non-citizen (usually, a permanent resident).
  • In addition, the applicant must have a high school diploma or a GED or be able to demonstrate the ability to benefit from the program
  • Applicants must also sign a statement certifying that they will use the aid only for education-related purposes, that they are not currently in default for any federal student loans, and that they owe no refund for any federal education grants.
  • The Pell Grant also requires that students maintain satisfactory academic progress in a degree-oriented program as defined by the school they attend. Males between the ages of 18 and 25 must register with the Selective Service.
  • A person may be eligible if previously incarcerated but with limited eligibility, depending on the offense.
  • Students may be ineligible if they have been convicted of a drug-related offense, but it depends on the actual charge when it happened, and if they attended a drug rehabilitation program. They must not have an outstanding Pell overpayment on record. Students who received a full scholarship of any kind are ineligible.
  • An applicant may not receive Pell Grant funds from more than one college at a time.

How to Apply:

  • There is no specific application for a Pell Grant. You will be considered for this award when you complete the Free Application for Federal Financial Aid (FAFSA).
  • You can fill out the FAFSA in three different ways: By applying online through the U.S. Department of Education’s website, FederalStudentAid.
  • The applicant should complete the FAFSA form for the first time prior to starting the freshman undergraduate year and then update the form each year as the applicant progresses through the college undergraduate term.
  • The first step in applying for the Pell Grant is to complete or update the FAFSA form on or after March 1 of each year.
  • After the initial FAFSA application is submitted, the student is notified by email or regular postal delivery if funding is awarded. Copies of the confirmation sheet should be made for personal records.

Financial Aid and Award Money:

  • As with all grants, there is a maximum amount that the government funds for each applicant. Each year the national legislature sets a maximum dollar amount that can be awarded to each student
  • The maximum amount of the grant usually depends on the EFC and several other factors, including cost of attendance, the amount of time the student plans to attend college
  • Once one has been considered eligible, the money can be obtained a couple of ways: the student’s school can apply Pell Grant funds to school costs, pay the student directly, usually by check, or combine these methods.

Use of Grant:

  • Typically, the college first applies the grant or loan money toward a student’s tuition, fees, and (if the student lives on campus) room and board.
  • Any money left over is paid to the student for other expenses: books, living expenses if the student does not live on campus, and transportation.


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