A Pell Grant is federal money for college that you do not have to repay

A Pell Grant is money the federal government gives to undergraduate students to help pay for college. Unlike a loan, you do not pay it back. The amount you receive depends on your family's financial situation, the cost of the school you attend, and whether you are a full-time or part-time student.

The U.S. Department of Education runs the program. Money goes directly to your school, which applies it to tuition, fees, and room and board. If money is left over after your school's costs are covered, you receive the remainder as a refund — usually by check or direct deposit.

Pell Grants are the foundation of federal student aid. Most students who receive any federal aid receive a Pell Grant first. The program has existed since 1972 and serves millions of students each year.

Key Takeaways

  • Pell Grants are assistance programs from the federal government that does not require repayment, unlike student loans.
  • The amount you receive depends on your Expected Family Contribution (a calculation based on income and assets), the cost of your school, and your enrollment status.
  • Your school must be accredited and participate in federal aid programs for you to use a Pell Grant there.
  • You must complete the Free Application for Federal Student Aid (FAFSA) to be considered for a Pell Grant.

How the amount is calculated

The Department of Education uses a formula to determine how much grant money your family is expected to contribute toward your education. This calculation is called your Expected Family Contribution (EFC). The formula looks at your family's income, assets, family size, and number of family members in college.

The maximum Pell Grant amount changes each year. Your actual grant is the maximum amount minus your Expected Family Contribution. If your family's contribution is zero or very low, you receive closer to the maximum. If your family's contribution is higher, your grant is smaller. If your Expected Family Contribution exceeds the maximum grant amount, you receive no Pell Grant.

The cost of your specific school also matters. A Pell Grant at a community college may be smaller than at a four-year university because the total cost is lower. Your school's financial aid office calculates your individual grant amount based on these factors.

Who can receive a Pell Grant

You must be a U.S. citizen or may be able to access noncitizen, have a valid Social Security number, and be enrolled or accepted for enrollment as an undergraduate student. You cannot have already earned a bachelor's degree. Graduate students and professional students do not receive Pell Grants.

Your school must be accredited by an agency recognized by the Department of Education and must participate in federal student aid programs. Most colleges, universities, and community colleges meet this requirement, but some do not. Your school's financial aid office can confirm whether Pell Grants are available there.

You must also maintain satisfactory academic progress — meaning you pass your courses and make reasonable progress toward your degree. Schools define this differently, but it typically means earning a minimum grade point average and completing a certain percentage of attempted credits each term.

How to start the process

Complete the Free Application for Federal Student Aid (FAFSA). This is the single form the Department of Education uses to determine your financial need and your Pell Grant amount. You can fill it out online at fafsa.gov. You will need your Social Security number, date of birth, and driver's license number (if you have one).

You will also need tax information from the previous year — your own tax return if you filed one, and your parents' return if you are a dependent student. If you have not filed taxes, you can provide income information directly. The form asks about income, assets, family size, and number of family members in college.

Submit the FAFSA as early as possible. Schools process aid on a first-come, first-served basis for some funds, and submitting early improves your chances of receiving the maximum amount. After you submit, the Department of Education sends you a Student Aid Report (SAR) that shows your Expected Family Contribution.

What happens after you submit the FAFSA

Your school's financial aid office receives your FAFSA information and calculates your Pell Grant amount. They send you an award letter showing how much you will receive and how it will be applied to your bill. This usually happens within a few weeks of submission, though it can take longer during peak periods.

Your school applies the grant money to tuition, fees, and other charges. If there is money left over, you receive it as a refund. The timing of the refund varies — some schools issue it before classes start, others after. Ask your financial aid office when to expect it.

You do not have to do anything else to receive the money once your school has processed your FAFSA. The grant is automatically applied to your account each term you remain enrolled and maintain satisfactory academic progress.

Pell Grants versus loans and other aid

A Pell Grant is different from a student loan because you never repay it. With a loan, you borrow money and pay it back with interest after you graduate or leave school. A grant is a gift — the money is yours to keep.

You may also receive other types of aid in addition to a Pell Grant: federal student loans, work-study jobs, or scholarships from your school or private organizations. Your school's financial aid package usually combines several types of aid. A Pell Grant is typically the first piece, and loans or work-study fill the remaining gap.

Some students receive a Pell Grant that covers their entire cost of attendance. Others receive a grant that covers part of the cost and need additional aid. The amount depends on your family's financial situation and your school's cost.

What can disqualify you or reduce your grant

If you are convicted of a drug offense while receiving federal aid, you may lose your Pell Grant for a period of time. The length of the suspension depends on whether the offense was for possession or sale, and whether it was a first or repeat offense.

If you default on a federal student loan — meaning you stop making payments and do not work out a repayment plan — you become ineligible for a Pell Grant until you resolve the default. Similarly, if you owe money back on a previous Pell Grant or other federal aid, you cannot receive new aid until you repay it.

Failing to maintain satisfactory academic progress at your school will also end your Pell Grant. This means not passing enough courses or not earning a high enough grade point average. Your school will notify you if you fall below their standard and explain what you need to do to regain may be able to access.

Frequently Asked Questions

Do I have to repay a Pell Grant?

No. A Pell Grant is a gift from the federal government. You do not repay it under any circumstances. If you later default on a student loan, you do not have to repay the Pell Grant you received earlier — only the loan itself.

Can I use a Pell Grant at any college?

Only at schools that are accredited and participate in federal student aid programs. Most colleges and universities do, but some do not. Before enrolling, ask the school's financial aid office whether Pell Grants are available there.

What if I do not complete the FAFSA by the deadline?

There is no single federal deadline, but your school may have one. Submit the FAFSA as early as possible — schools process aid on a first-come, first-served basis for some funds. Late submission may reduce the amount you receive.

Can I receive a Pell Grant if my parents did not go to college?

Yes. Your parents' education level does not affect your Pell Grant. Only your family's income, assets, family size, and number of family members in college matter. First-generation students are treated the same as all other students.

What happens to my Pell Grant if I change schools?

Your Pell Grant follows you. When you transfer, your new school receives your FAFSA information and recalculates your grant based on their cost of attendance. You may receive a different amount because the cost is different, but you remain may be able to access as long as you maintain satisfactory academic progress.