Pell Grants Help Subsidize College
Grants and loans are the major forms of federal financial aid for students seeking to earn a bachelor’s degree. The largest federal grant program available to undergraduates is the Pell Grant, which assists students from low-income households. To qualify, a student must demonstrate financial need through the Free Application for Federal Student Financial Aid, or FAFSA.
According to The Institute for College Access & Success, a California-based nonprofit, Pell Grants help more than 7.5 million low-income students pay for college. Here are 10 things to know about this grant.
1. Not all schools participate.
Some colleges and career schools don’t participate in the federal student aid programs. Experts say prospective students should check whether the school they plan to attend does so.
According to the Department of Education, more than 5,400 institutions participate in the federal aid program and disburse the Pell.
2. Enrollment status determines eligibility.
Pell Grants are usually awarded to needy students who haven’t earned a bachelor’s, associate or professional degree.
To meet eligibility requirements, these students must be enrolled in a participating institution at least half time. Award amounts are adjusted if the student attends less than full time.
3. Eligibility is also determined by income.
Many Pell Grant students don’t receive the full award, since the grant amount depends on a number of variables including family size and income. According to the Department of Education’s data for Pell Grants disbursed in the 2015-2016 academic year, the typical student receives around 64 percent of the maximum amount.
Students whose total family income is $50,000 a year or less qualify. But most Pell Grant money goes to students with a total family income below $20,000.
4. Pell Grants are available year round.
The year-round Pell Grant was restored for the 2017-2018 academic year and became available to students as of July 2017. According to a recent study by the Community College Research Center, the likelihood of a student completing an associate degree increases with the availability of the year-round Pell.
“Under year-round Pell, students who wish to pursue their degrees throughout the year will receive financial aid when they need it, rather than having to wait until the following semester, ultimately allowing them to complete their education more quickly,” said Justin Draeger, CEO of the National Association of Student Financial Aid Administrators, in a news release.
5. Recipients can claim awards for summer courses.
Starting in summer 2017, students will be able to use a Pell Grant toward summer college courses. Previously, a student could only use these funds for spring and fall college programs.
Experts say students who take advantage of this aid for their summer courses can complete their degree programs more quickly, trimming down college costs.
6. Awards can be used to pay for college expenses.
Like other federal student aid, a Pell Grant may be used to cover a variety of costs from tuition and fees to books, supplies, living expenses and transportation, to name a few examples.
A full award typically covers tuition and fees at a community college, which usually costs around $6,000 per year. But this grant doesn’t go as far at a four-year public institution, where it may only cover 30 percent of the cost of attendance, according to TICAS.
7. Pell Grants don’t need to be paid back.
Unlike a student loan, grant money doesn’t have to be paid back. The FAFSA is the key to unlocking this subsidy as well as federal direct loans.
This subsidy is only awarded to undergraduate students who qualify based on a combination of financial need, college costs and enrollment status.
8. Award amounts change annually.
Amounts change each year. The current maximum award for the 2017-2018 school year is $5,920.
While the maximum Pell Grant award amount increases each academic year, some experts say the increase isn’t enough to offset the cost of inflation.
9. Pells have a maximum usage limit.
The Department of Education has established lifetime limits for Pell Grant funding. A student can only receive up to 600 percent — approximately six years — of this subsidy. Once this limit has been reached, the student can’t receive any additional Pell awards.
Recipients can check their “Lifetime Eligibility Usage,” the percentage of Pell funding the student has used, by signing on to the National Student Loan Data System.
10. Pells are available for some postbaccalaureate programs.
Since 1998, some students who have earned a bachelor’s degree are able to receive a Pell Grant when enrolled in a postbaccalaureate teacher certification or licensing program.
Experts say this grant works best when applied to fifth-year teaching certification programs.
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10 Facts to Know About the Pell Grant originally appeared on usnews.com
