How Does Federal Pell Grant Work?

July 5, 2012

Students use all types of financial aid programs to get through school. In some cases, federal financial aid is the only type of help that college students receive. The program was developed for low-income students who didn't have any other source of income, either dependent on low-income parents or independent (over the age of 24). Today, the Pell Grant has undergone some changes. The funds still remain one of the best ways for college students to be able to go to school. With up to $5,550 offered to students per semester, it's one reason to understand more about this program and how you can get a Pell Grant for a college degree.

How Pell Grant Began

Senator Claiborne Pell from Rhode Island created the Pell Grant through the Higher Education Act of 1965. It was meant to be a program specifically for students who had lower incomes or came from families with low incomes and hardly any assets. More than 5,400 universities in the United States participate in the federal grant program. Today, students can apply online for the Pell Grant as well as many other federal grant programs like the Federal Supplemental Equal Opportunity Grant or SMART Grant.

Getting into the Program

Anyone can apply for federal financial aid. You have to file a Free Application for Federal Student Aid or FAFSA. You can easily complete this form and receive step-by-step help at In order to get into the program, you have to fill out the form entirely, including your contact information, social security and identification information, income and taxes, and school codes. Not every is eligible for Pell Grants, but FAFSA offers a bunch of other opportunities for federal aid, such as other grants, work study programs and student loans.

Who is Eligible for Pell Grants

Eligibility to get into Pell Grant is based on several different factors. Most of all, it relates to your family's income and assets. You must have a low Expected Family Contribution (EFC) in order to be considered a low income student. Students must also include parents' income unless they are married, have a child or are over the age of 24. This is why it's hard for some students to get into the Pell Grant program, particularly if both parents work. In addition, you have to maintain decent academic grades, part time or full time status, a required length of attendance and cost of attendance. Basically, you can't receive the Pell Grant for longer than six years, and you must pass all of your classes or risk losing financial aid or having to pay it back if you drop out of a class.

When to Apply

The best time to apply for the Pell Grant is on January 1st. This is the first day that the FAFSA is available online and it's also the day that many students rush to get their applications in first. That's because the Pell Grant and other federal financial aid programs are first come, first serve, meaning that the financial aid pool grows smaller after each day. In addition, you may need to verify your income among other things that will take time.

You should always pay attention to the deadlines for FAFSA and get your application in on time to be considered for the Pell Grant. You can always appeal a financial aid decision to get more money or appeal a rejection notice.

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Whether you’re on your way to school for the first time or thinking about finishing up a degree you should explore your options when it comes to obtaining Grants for School.

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