Your Guide to Pell Grants

Your Guide to Pell Grants. The cost of attending college might be extremely expensive. In actuality, the debt owed on student loans reached a record high of $1.5 trillion at the end of 2019. However, there are other ways to pay for school that doesn’t carry the same interest rates as government and private student loans. We look at the Pell Grant as one of those possibilities. Find out what a Pell Grant is, how it functions, if you have to pay it back, as well as the benefits and drawbacks of using it to pay for college.

What Is a Pell Grant?

The Department of Education awards Pell Grants, which are federal funds, to undergraduate students who have not previously received a degree and who demonstrate “exceptional financial need.” Typically, the Pell Grant is given by the Department of Education to a student pursuing a bachelor’s degree.

How Pell Grants Work

The cost of attending college might be extremely expensive. In actuality, the debt owed on student loans reached a record high of $1.5 trillion at the end of 2019. However, there are other ways to pay for school that doesn’t carry the same interest rates as government and private student loans. We look at the Pell Grant as one of those possibilities. Find out what a Pell Grant is, how it functions, if you have to pay it back, as well as the benefits and drawbacks of using it to pay for college.

• Taxed and untaxed income
• Benefits
• Assets
• Family size
• Number of family members who will attend college
• Cost of attendance

The Department of Education awards Pell Grants, which are federal funds, to undergraduate students who have not previously received a degree and who demonstrate “exceptional financial need.” Typically, the Pell Grant is given by the Department of Education to a student pursuing a bachelor’s degree if you qualify based on your EFC, the cost to attend the schools you list in your FAFSA, and how many classes you’ll take.

For example, if you qualify, you may be able to get $6,895 in Pell Grant funds for the 2022–2023 school year if your EFC is $0, you attend full-time, and your cost of attendance is $6,985 or more.

Pros and Cons of Pell Grants

• Grant recipients need to maintain requirements.
• Income thresholds are low, so it can be tough to qualify.
• Not meant to cover the entire tuition bill.

A major pro of a Pell Grant is that you don’t need to repay it. However, you may have to repay the money if you:

• Withdraw early from the program
• Change your enrollment status and counter your eligibility for the grant
• Receive other federal aid or scholarships that reduce your need for the grant
• Do not meet the requirements of your grant

You must continue to meet the program’s requirements in order to continue receiving federal grant funds. You must fulfill the income requirements, submit the FAFSA, and make steady progress toward your degree in order to be eligible for a Federal Pell Grant.

One more disadvantage is that you could not be qualified for a Pell Grant. You could not be eligible for the grant in the following circumstances:

• Your parents make too much money.
• Your family size doesn’t qualify.
• You are incarcerated in a federal or state institution.
• You are convicted of a drug-related offense while receiving financial aid (in some cases).
• You are convicted of a sexual offense.
• You received the grant for six years.
• You have a criminal history.

Finally, it’s likely that a Pell Grant won’t pay the full cost of your tuition. A four-year public university’s average tuition is $20,050.6. This means that even if you obtained a Pell Grant in full, you might need to secure more than $13,000 in additional funding to attend a university.

Other Grants and Student Loans

While a Pell Grant is a great way to help pay for your college education, you can also apply for other grants that are comparable if you don’t meet the eligibility requirements.

• Federal Supplemental Educational Opportunity Grants (FSEOG): For undergraduate students with exceptional financial need
• Iraq and Afghanistan Service Grants: For students whose parent or guardian died serving in Afghanistan or Iraq
• Teacher Education Assistance for College and Higher Education (TEACH) Grants: For students who plan to become teachers

There are other ways to pay for your education if you don’t qualify for a Pell Grant. By completing the FAFSA, you can apply for federal student loans, and you can also apply for private student loans from a number of lenders. Although they must be paid back, these can aid in defraying the escalating cost of higher education.

You can also think about participating in a work-study program at your school, which can help pay for extras like housing and board, books, and meal plans or lower the cost of attending college.

Check Also:

What Does It Mean to Be Underwater On a Car Loan?