You may have heard of the Free Application for Federal Student Aid, or FAFSA, if you or someone you know has plans to attend a college, career school, or university. Last year, over 60% of high school seniors submitted a FAFSA to the Department of Education to secure financial assistance. But what many prospective and current students may overlook are the various federal grants awarded to students in need each year.1
Most federal grants, unlike loans, function as sources of funding. There are some exceptions, though. For example, if a student is awarded a grant, but withdraws from the program in which they’re enrolled, they may be required to pay back all or a portion of that grant.2
Know your grants
The Department of Education offers multiple aid packages as part of the Federal Student Grant Program. The following four are granted most often, and each has different requirements for eligibility. The information below applies to the 2020-2021 academic year:
- Federal Pell Grants - With a maximum award of $6,345, Pell Grants are reserved for undergraduate students who have exceptional financial need and have not earned a bachelor’s, graduate, or professional degree yet.3
- Federal Supplemental Educational Opportunity Grants (FSEO) - FSEO Grants award a maximum of $4,000 to those who demonstrate exceptional need and have not yet earned a bachelor’s or graduate degree. FSEO Grants also give priority to Pell Grant recipients over other applicants.4
- Iraq and Afghanistan Service Grants - These grants award a maximum of $5,829.50, and they’re only for students whose parent or guardian served in a branch of the U.S. Armed Forces and died while serving in Iraq or Afghanistan after the events of 9/11.5
- Teacher Education Assistance for College and Higher Education (TEACH) Grants - TEACH Grants award a maximum of $3,764, and they’re reserved for students who are enrolled in teaching preparation programs and agree to teach for a minimum of 4 years at the elementary or secondary school level in a high-need field.6
No matter who you are or your financial situation, you may want to consider submitting a FAFSA. After all, the grants listed above do require recipients to have an application on file with the Department of Education. And who knows? The potential financial benefit that you could secure may surprise you.
1. Finder.com, 2019
2. StudentAid.gov, 2020
3. StudentAid.gov, 2020
4. StudentAid.gov, 2020
5. StudentAid.gov, 2020
6. StudentAid.gov, 2020
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation.