One of the most widely available grant programs for students entering college is the Federal Pell Grant program. These are one of the few government sources of “free” money for college. Students who are eligible for Pell Grants do not have to pay back the money. They are also not awarded based on grades. This is a needs-based grant program that awards money based on a student’s Expected Family Contribution. Those who have significant financial need can receive money.
The amount of money students can get through the Pell Grant program varies from year to year. The government decides how much money to put into the program, and that dictates the amount of the award. The amount is also chosen based on how much the college classes will cost, what the Expected Family Contribution is going to be, and whether or not the student is enrolled full time. For the 2008-2009 school year, the maximum amount a student could receive through the program was $4,731.
One interesting difference between the Pell Grant program and the federal loans is that students are not subject to a lifetime cap. With the federal loans, there is a limit on how much money a student can borrow. Pell Grants are only limited by the students and the length of time it takes them to get their first bachelors degree. If that takes eight years, the money is available for eight years.
The only way to apply for a Pell Grant is to fill out the FAFSA. Be honest on this form, because failure to report all income or assets will result in tough penalties, including possible jail time. This form is used to determine your Expected Family Contribution. If you think your family has too much money or too many assets, fill out the form anyway. The formula is complicated, and you may qualify for some help that you do not know of.
Since this is also the way to qualify for federal loan programs, go ahead and fill it out. The form will go to your college, where they will subtract the Expected Family Contribution from the cost of attendance to determine how much you will be expected to pay. If you are going to receive Pell Grant money, you will receive an award letter. There is nothing else you can do to ensure that you get this money. While you wait, pursue other financial aid options. Even if you do receive a Pell Grant, it will not be sufficient to pay for all of your schooling, so keep your eyes open for other help.