The Pell Grant is a form of need-based federal financial aid that helps pay for college costs, including tuition, fees, room and board and other educational expenses. Here are a few things to know about the country’s largest grant program available to undergraduate students.

Who is eligible for a Pell Grant? 

To be eligible for a Pell Grant, students must

• demonstrate exceptional financial need on the Free Application for Federal Student Aid (FAFSA); and

A family's information on the FAFSA, including income and number of children enrolled in college, is used to generate a number known as the student's expected family contribution, or EFC, and to determine whether a student is eligible for a Pell Grant. While graduate students are not typically eligible for Pell Grant aid, in some cases students seeking a post baccalaureate teacher certification may be eligible.

The Pell Grant is unique because a student's eligibility does not vary across schools if the colleges participate in the federal student aid program. About 6,000 colleges and universities participate, according to the U.S. Department of Education.

Students may lose Pell Grant eligibility if they:

• withdraw from courses after the add/drop period; or
• do not maintain their enrollment status (for example, drop below what your school considers half time), or fail to continue making academic progress, which can include GPA requirements set by individual colleges and universities.

How much money can a student receive from a Pell Grant?

A student's Pell Grant amount depends on:

• their EFC;
• the cost of attendance at the chosen college or university;
• the amount of the academic year he or she plans to attend; and
• and the student's enrollment status as part-time or full-time.

Schools use a chart from the U.S. Department of Education, which is updated annually, to calculate a student's Pell Grant award each year based on these factors. The maximum Federal Pell Grant award is $6,895 for the 2022–23 award year (July 1, 2022, to June 30, 2023).

A college or university will distribute the Pell Grant funds directly to the student in payments called disbursements. The school will then be reimbursed by the federal government.

Does a Pell Grant need to be paid back?

The Pell Grant typically does not need to be repaid. This is a key difference between Pell Grants and certain other forms of student aid, such as student loans.

How does someone apply for a Pell Grant?

There is only one step in applying for a Pell Grant: completing the FAFSA. Students must submit the FAFSA annually to continue receiving Pell Grant funds. If an updated FAFSA results in a change to a student’s EFC, it may lead to adjusted Pell Grant award amounts. Related: Can I Combine a 529 Plan with Financial Aid?

Key Takeaways:

• Pell Grants are awarded based on financial need and, unlike loans, typically don't have to be repaid.
• Applicants must complete a Free Application for Federal Student Aid (FAFSA) every year to qualify.
• Individual schools determine how much Pell Grant money (if any) to offer each student, up to the federal maximum.

Visit the Federal Student Aid site to learn more about the Pell Grant criteria.