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Articles / Paying for College / Your Guide to Grant Aid

Your Guide to Grant Aid

Rob Franek
Written by Rob Franek | March 19, 2020
Your Guide to Grant Aid


Between applying for scholarships and seeking other financial aid, you're sure to encounter plenty of offers during your college application process, including scholarships and loans. All of these resources will provide you with the money you need, but many will require that you pay it back, often with interest. The best kind of aid, then, is the kind you're not required to pay back. You're likely already familiar with scholarships, which are most frequently awarded by schools as a means of encouraging specific students to attend their institutions on the basis of athletic or academic merit. But there's another form of so-called "gift aid" that you may be less informed about, and those are grants, which are often given by the government and tend to be based on financial need. Here's a breakdown of the most common types of grants.

Federal Grants

The first source of grant aid is the federal government. This type of grant is awarded only to US citizens or eligible noncitizens. The most common federal grant is called the Pell Grant, which is primarily for low-income families. When you fill out the FAFSA, you're also automatically applying for the Pell Grant. As with any aid, though, that doesn't mean you'll automatically receive it; the size of the award is decided by the federal government. Also, importantly, that amount cannot be adjusted by colleges, so appealing your financial aid offer won't get you more money in that regard. If you do qualify, though, you'll receive up to $6,095 per year.

Another federal grant you may have heard of is the Federal Supplemental Educational Opportunity Grant (SEOG). The SEOG is money directly from the government, but it's disbursed by the colleges. That means the schools get a lump sum each year that they are allowed to dispense at their own will. The size of this award runs from $100 to $4,000 per qualifying student.

State Grants

The federal government isn't alone in its attempts to assist students; state governments often get in on offering grants as well. Students attending college in their state of residence may qualify for state grants that are also based on need. To determine the grant amount, states will consider the cost of tuition at the applicable school and then administer the money accordingly. In order to qualify for state aid, you may need to fill out a separate application in addition to the FAFSA — be sure to inquire at your school to ensure you're completing the necessary forms.

If you're going out of state for school, you're not out of luck, though! A few states have reciprocal agreements with other states that allow you to take aid with you to another state. These typically fluctuate every so often, but common programs include the Midwest Student Exchange, the Academic Common Market (which includes mostly southern states), the New England Regional Student Program and the Western Undergraduate Exchange.

Grants from the Schools Themselves

Apart from the government-given SEOG, some schools have grant money of their own to give. Since this money comes out of the colleges' coffers, these grants serve as discounts off of a school's sticker price. Additionally, as this is not taxpayer money, there are no rules about how it must be dispensed. The school can award it based on whatever logic it chooses, whether that's based on need or merit. There is no limit on the size of a grant from an individual school — it could range from a few hundred dollars to a full-ride scholarship. Each school, however, will have its own policies regarding minimum and maximum grant values.

It's important to study up on paying for college just as you might for a big test on your schedule. For more help, check out our book Paying for College and subscribe to our YouTube channel for more strategies to help.

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Written by

Rob Franek

Rob Franek

College Admissions and Test Prep Expert

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