Low-income college students could get an extra $500 this year to help them pay for the cost of their education.
Under the latest federal spending plan signed by President Joe Biden Thursday, the maximum value of the Pell Grant is set to rise to nearly $7,400 for the 2023 fiscal year, a $500 increase from the current max award of $6,895.
Higher education advocates praised the increase, saying it could help more low-income students start and complete college.
The $500 figure is on top of a $400 increase the prior year, making it the largest two-year increase in the program’s history, said Terry Hartle, a senior vice president of government relations and public affairs at the American Council on Education, a trade group of universities.
How many low-income students receive Pell Grants?
More than 6 million college students received the Pell Grant in the 2020-21 academic year, according to the Department of Education. Unlike student loans, students don’t have to pay the money back in all but the most extreme cases.
Biden has said he plans to increase the maximum Pell Grant to $13,000 by 2029, and Hartle other advocates had hoped that increase would happen sooner rather than later.
Still, the larger award this year will, “help an awful lot of people who are trying to decide whether to start or to continue a post-secondary education,” Hartle said.
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How do I apply for a Pell Grant?
To receive a Pell Grant, students have to fill out the Free Application for Federal Student Aid, or the FAFSA, as it’s more commonly known. It’s free to complete.
Under a new form slated to take effect in 2024, students will only have to answer about a third of the questions they had in previous iterations. The government is also tweaking its method for determining how much students and their families might contribute to their education costs, which could result in more money for students with the greatest need.
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Hartle said universities are eager to see the changes take effect because they could make it easier for students and families to receive the money they need to attend college.
How much is the Pell Grant award?
Not every student will receive the full $7,400 available under a Pell Grant. In the 2020-21 award year, the average student received about $4,600. A student’s award depends on how much they and their family are expected to contribute to the cost of their education.
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An average four-year degree at a public university costs about $9,400, and the cost climbs dramatically to $37,600 for those attending a private institution, according to the National Center for Education Statistics.
What does $500 cover on a college campus?
Pell Grants are typically awarded to universities directly, and the institution will use the funds to cover tuition, fees and other costs. Anything leftover is given directly to the student, who can use that money for other education-related expenses.
It’s fair to say $500 doesn’t cover much when it comes to higher education but it could make life easier for some students.
The average student spent about $340 on course materials— think textbooks and similar equipment– in the 2021-22 academic year, according to a survey from the National Association of College Stores.
Parking permits for students can cost hundreds of dollars at colleges across the country annually. On-campus parking for students living at Montana State University, for example, costs between $100 to $245 annually. At the University of Virginia, student permits can cost between $324 to $804 annually.
Students, especially those in science, technology, engineering and mathematics majors, are likely to pay additional fees for specialized lab courses that can cost hundreds of dollars. And many campuses may require students to have health care plans and some automatically enroll students in programs where the annual premiums can cost thousands of dollars. Students can opt out of these plans if they prove they’re insured either through their parents or through plans available via the Affordable Care Act.
Contact Chris Quintana at (202) 308-9021 or [email protected]. Follow him on Twitter at @CQuintanadc
