Looking for College Money? - the Truth About Pell Grants

In another recent article, I outlined the basic steps for filling out the FAFSA. The Free Application for Federal Student Aid (FAFSA) is the starting point for receiving governmental financial assistance for college education. In that article, I said that everyone should fill out the FAFSA, because you never know what you might get. While this is the case, many wonder about Pell Grants-free money from the government? It seems too good to be true. Unfortunately, for most of us, it is.

There are two main types of financial aid received from FAFSA programs-grants and loans. Loans are what you'd expect. The government gives you money now, and you pay it back later. There are several types available-all defer payment until after graduation, and some defer interest until some time after graduation as well. An added bonus of these loans is a lower-than-usual interest rate. The government is often able to offer interest rates somewhat lower than the market standard. Grants, however, are a different species altogether. A grant, as defined by the American Heritage Dictionary, is "a giving of funds for a specific purpose." If you receive a grant, it's free money for school, plain and simple. You never have to pay back a dime of any grant received. Obviously, grants are better than loans. Logic suggests that grants are also harder to get. The most significant (and largest) grant offered through the FAFSA program is the Pell Grant.

As I filled out the FAFSA, I knew I wasn't likely to qualify for a Pell Grant. My parents make a decent amount of money, though we're not rich by any stretch of the imagination--paying for college is still quite a challenge. Sure enough, when I received notification, though I qualified for some loans, I got nothing in the way of grants. I was disappointed, but, then again, I wasn't expecting to qualify for them in the first place.