What is the Pell Grant?

Between scholarships, federal aid, and loans there is a lot to do before heading to college in the fall, but one thing you don’t want to forget about is the Pell Grant. It’s one more reason to complete the FAFSA, or Free Application for Federal Student Aid. But what exactly is it?

A Pell Grant can help you afford college

Flickr user COD Newsroom

What Is the Pell Grant?

The Pell Grant is a federal subsidy that, unlike a loan, does not need to be repaid but there are limitations as to who can receive one. They are first only eligible to students who have demonstrated financial need. You also have to have not yet received a Bachelor’s or professional degree, though there are a few exceptions including for post-baccalaureate teacher certification programs.

However, not all schools participate in the Pell Grant program. Currently, about 5,400 colleges, universities, and other post-secondary institutions throughout the country take part. This results in approximately 5.4 million students benefiting from the federal grant.

It’s also important to note that you cannot receive the Pell Grant if you are incarcerated and you cannot receive more than one at a time.

How Do You Apply?

Thankfully, applying for the Pell Grant is easy. Filling out the Free Application for Federal Student Aid, more commonly known as the FAFSA, will automatically qualify as an application for the federal grant. Remember to fill out the form every year as your eligibility can change. Too many students make the mistake of applying one year, not being accepted, and failing to reapply not realizing that eligibility requirements change year-to-year.

Who Is Eligible to Receive the Pell Grant?

The Federal Pell Grant is dedicated to students who demonstrate exceptional financial need on the FAFSA. Other requirements include:

  • U.S. Citizen or eligible non-citizen
  • Not previously earned a bachelor’s, graduate, or professional degree
  • Maintain enrollment status if deemed eligible
  • Maintain satisfactory academic progress if deemed eligible

Major changes to Pell Grant eligibility is coming this year, too. In December 2023, the Department of Education and Federal Student Aid are releasing a new, simplified version of the FAFSA. One of the most important changes that come this year is the new formula that will be used to determine Pell Grant eligibility.

The Student Aid Index (SAI) is replacing the Expected Family Contribution (EFC) to help make it more clear how much a family or student is expected to contribute to their education costs. Using a different formula, the SAI will also make it clearer to the government and colleges which are the students in most need of financial aid. This number can be in the negative and those with an SAI of $0 and -$1,500 can receive the maximum amount of the Pell Grant. SAI’s higher than $0 may be eligible for a smaller Pell Grant.

Early projections show that just under 43% of students who were previously deemed ineligible may become eligible with their next FAFSA.

How Much Do You Get From The Pell Grant?

The amount you receive from the Pell Grant depends on several factors. The amount you can receive changes every year. For the 2023 – 2024 award year, the maximum amount that could be granted was $7,395. Your personal and family’s financial need, tuition and school costs, and how many semesters you plan to stay in for the upcoming academic year all affect how much you will receive. Whether you are a full-time or part-time student will also determine the amount of the grant.

If you are the son or daughter of a parent who died in Iraq or Afghanistan after 2001, you may also be eligible for more money.

While you do not normally have to repay the federal grant, there are a few exceptions. If you leave school early from the program or your enrollment status switches from full-time to part-time, you may have to pay back the money that was given. Scholarships and other grants could also have an effect on the Pell Grant’s repayment requirement.

How is it Awarded?

If you are awarded the Federal Pell Grant, there are a few routes you and your school can take. Most schools put the money directly towards the cost of attending. That covers fees, tuition, and potential housing expenses if you choose to stay on campus. Others may decide to pay you directly, send a check or a combination of all three.

Applying for federal student aid is a must for all students who are planning to attend college, even if you don’t believe you will be eligible for any loans. The Pell Grant is just one other reason that makes filling out the FAFSA essential to starting college. And with the upcoming changes to the Pell Grant eligibility, SAI, and FAFSA, it is more important than ever to complete your application!

Even with the Pell Grant, affording college may just be out of your ballpark. Scholarships are a great way to close the gap between what you have and what you need. Use College Raptor’s Scholarship Search Tool to find awards you qualify for


Lender Rates (APR) Eligibility
Citizens logo.
6.97%-15.03%* Variable
5.99%-14.00%* Fixed
Undergraduate and Graduate
Sallie Mae logo.
6.37% - 16.70% Variable
4.50% - 15.49% Fixed
Undergraduate and Graduate
Credibe company logo.
4.98% - 16.70% Variable
4.07% - 15.66% Fixed
Undergraduate and Graduate
Lendkey company logo.
6.07% - 11.31% Variable
4.39% - 10.39% Fixed
Undergraduate and Graduate
Ascent company logo.
6.22% - 16.08% Variable
4.09% - 15.66% Fixed
Undergraduate and Graduate
6.54% - 11.08% Variable
3.95% - 8.01% Fixed
Undergraduate and Graduate
Earnest company logo.
5.62% - 18.26% Variable
4.11% - 15.90% Fixed
Undergraduate and Graduate
4.98% - 12.79% Variable
8.42% - 13.01% Fixed
Undergraduate and Graduate
College Raptor is not a loan lender and does not assume responsibility for suggesting a loan to a user who may not be eligible for it. Rates, terms, conditions, eligibility, approval, and other considerations are the decisions of the lenders and may vary depending on which lender or marketplace the user selects. We urge users to carefully consider and review all loan options and terms before committing to taking out a loan.

2 thoughts on “What is the Pell Grant?”

  1. Robert Davis says:

    if I decide not to use the pell grant what do I do

    1. Allison Wignall says:

      Hello, Robert! We have a helpful guide to financial aid (and the order in which you should seek it out) over here: How to Prioritize Your Financial Aid Opportunities. Hope this helps!

Comments are closed.