The $6,200 Pell Grant Program

The Pell Grant program is America’s largest student aid program that provides grants of up to $6,200 to the nation neediest students to attend college. And it does not need to be repaid.

With skyrocketing tuition,1 one major concern for students who want to pursue higher education is how to pay for it.

Not surprisingly, the burden is heaviest on students from lower-income families — disproportionately single mothers.

Few could afford the price tag without generous student aid including grants, work-study and federally-subsidized student loans.

Almost any student with financial need, regardless of income, are entitled to some forms for financial aid.

And Pell grant is the best source of free financial aid any student can receive.

For many students who completed the financial aid process — or FAFSA, Pell grant is the foundation of their financial aid package onto which other aid are added.

What is Pell Grant?

The Pell Grant program is America’s largest need-based student aid program. In 2017 alone, the U.S Dept of Education handed out over $28.2 billion in Pell Grants to nearly 7 million students.2

It is an entitlement program that provides grants of up to $6200 to the nation neediest students to attend college. Grants are awarded on a sliding scale based on one’s financial need — and it does not need to be repaid.

But how much you’re eligible to receive hinges upon 2 factors

  1. How much you’re expected pay out of your own pocket — taking into account your asset & income.
  2. The cost of attendance at your college — tuition, fees, room and board, books, etc.

Other factors that determine your Pell Grant eligibility include the amount of time you attend college (whether you are a full time or part time student) and the number of semesters you will attend.

How Do I Apply for Pell Grant?

To be considered for a Pell Grant, you must submit a Free Application for Federal Student Aid (FAFSA) online at The deadline for filling the application form is June 30 each year.

The U.S. Department of Education uses a standard formula to evaluate the information you provide on your FAFSA. This formula produces a number called the Expected Family Contribution (EFC), which determines (if any) how much aid you’re eligible.

What it actually means is the lower your EFC, the more financial aid you’ll be awarded. The best case scenario is to get a Zero EFC for maximum aid eligibility.

An EFC of $0 means that you have no ability to pay for college, as such, you’re eligible to receive maximum award, while a number over 5576 will result in no aid at all.

Facts & Statistics

  1. The maximum award is $6195 — an increase of $100 from the 2018-19 award year.
  2. The minimum award amount for a full- time undergraduate student is $650.
  3. If your family’s income is $25,000 or less, you automatically qualify for an EFC of $0 and be eligible for maximum award.3
  4. If your EFC is greater than $5576, you are NOT eligible for any aid.4
  5. 49% of Pell Grant recipients were dependent students; 37% of these students came from families with incomes of $20,000 or less. 16% with incomes of $9,000 or less.5
  6. Lifetime eligibility is 12 semesters, or the equivalent. If you have exceeded the 12-semester maximum, you will lose eligibility for additional grants.

Grants vs Loans

Although the Pell award isn’t exactly a princely sum, it makes college possible for many low-income single moms who couldn’t otherwise afford the rising cost of going to back college.

However, as the cost of college outpacing the availability of aid, more students than ever are relying on federal loans to help pay their way through college.

Unlike grants, these loans are “borrowed money” you must repay with interest upon graduation, albeit lower than most conventional loans.

Among Pell Grant recipients who graduate from four-year colleges, nearly nine out of ten have student loans,6 including very-low-rate Perkins and “subsidized” and “unsubsidized” Stafford loans.

Until the government could better package financial aid, borrowing money to pay for college can be a sensible option; as long as you do it wisely.

  1. CollegeBoard, Tuition and Fee and Room and Board Charges over Time, 1973-74 through 2013-14
  2. CollegeBoard, Trends in Student Aid 2018
  3. Federal Student Aid, EPC Formula Guide
  4. FSA, 2019-2020 Federal Pell Grant Payment and Disbursement Schedules
  5. NASFAA, 2016 National Student Aid Profile
  6. Data from the U.S. Department of Education, National Postsecondary Student Aid Study