A college education can be a costly endeavor. In fact, it is estimated that 2/3 of all full time students receive some type of financial aid. The United States Department of Education sponsors and provides many loans and grants that can assist the student in fulfilling the financial needs of tuition costs. Federal grants, unlike student loans, do not require repayment, and are therefore preferred under most circumstances.

The number of students from lower income households that earn college degrees is measurably lower than those from middle to upper income families. The federal Pell Grant was established to help close the gap between those earning degrees in the lower and upper income levels. The Pell Grant program began in 1972 and was named after a Rhode Island democratic senator named Claiborne Pell. Today the grant assists 5.4 million full and part-time students attending college and vocational schools.

A student’s Pell Grant eligibility is based on financial need. Financial need is based on information supplied by the student on the Federal Application for Federal Student Aid that all students must fill out no matter what type of aid the student is applying for. The amount of the grant award is formulated and based on the student’s Expected Family Contribution. Several factors are considered in the formula that calculates this award amount. These factors include the price of attending the college, the family’s financial situation, family size, and whether or not a student is attending part time or full time. Because the grant is awarded to lower income students, colleges use this data to determine the school’s economic diversity.

Eligibility requires a student to be working towards an associate’s degree or bachelor’s degree. Students cannot already have a previously earned bachelors degree. The only exception is some post baccalaureate programs that result in teacher licensure. Students must be enrolled at least half-time in their program of choice.

The federal Pell Grant for the 2010-2011 school year is awarded at a maximum amount of 5,550 dollars. The funds are either credited to the student’s school account or paid directly to the student by check. Students are paid at least once per term. Schools that do not use semesters, trimesters or quarters must pay out funds at least two times during the academic year. The Federal Pell Grant provides funding for students that come from low income families. Approximately 57 percent of Pell Grant recipients have a family income of less than 30,000 dollars per year. The grant provides these students with more post high school options for continuing their education.

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