As of 2015, the U.S. Congress mandates a standard formula that determines an individual's financial need for receiving a Federal Pell Grant based on criteria such as the student's and parents' income and assets, the status of the family household, and the status of the student, as the U.S. Department of Education reports. The amount of assistance students receive depends on expected family contribution, the attendance cost at the selected educational institution and the student's enrollment status.Continue Reading
The formula that assesses financial need varies depending on whether the student is dependent on parents or relatives, independent but alone, or independent with dependents, as detailed by the U.S. Department of Education. The size of the household and the number of family members attending college in addition to the student applying for the grant are also factors. The Department of Education calculates the expected family contribution based on a percentage of net family income and assets with subtractions for living expenses, taxes and an allowance for asset protection.
As of 2015, the maximum annual award for a Federal Pell Grant is $5,775, according to Federal Student Aid. The specific amount students receive depends on whether they enroll as full- or part-time students and whether they attend college for a complete academic year. Students can receive Pell Grants for only 12 semesters of education in total. Students under 24 years old may receive larger Pell Grants if their parents died in Afghanistan or Iran after 9/11 while performing military service.Learn more about Credit & Lending