What is the Difference between Financial Aid and a Pellgrant?

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One Response to “What is the Difference between Financial Aid and a Pellgrant?”

1. Chancluda on: 29 July 2009 at 4:48 am

   A Pell Grant is a type of financial aid. Financial aid is any help (whether from government funding or private sources) that a college student receives to help pay tuition and/or other costs associated with college (such as books, room/board, etc.). The three general types of financial aid are grants, loans, and work/study.

   Grants do not have to be repaid, and require no labor in return. Scholarships are grants. Pell Grants come from the U.S. Government and can only be used to pay tuition. The amount of money a student gets from a Pell Grant is based on income (for most students, it’s the parents’ income; the exception is if a student can prove that he/she is financially independent of his/her parents).

   Loans have to be repaid. There are government programs (both state and federal) that provide low-interest student loans that can pay for tuition, room/board, textbooks, and/or a combination of the above. Most banks also offer their own student loan programs, but shop carefully as rates and conditions vary widely. Usually there is a "grace period" after leaving school before beginning repayment (mine was 6 months). Interest on my state-sponsored loan was 9%, and it took 10 years to pay it off.

   Work/study is just as its name suggests. These programs give money that has fewer restrictions on how it is spent, but in return, the student works for the college/university. Graduate assistant teachers, RA’s (student "dorm monitors" in charge of a floor or wing of a dormitory), and many "worker bees" at a college are participants in a work/study program. These programs are administered through the individual schools, and positions are highly coveted and competition for these spots can be fierce.

   Now that I’ve been reminded by other responders that the FASFA is the form used to apply for financial aid, I can also remember that that one form will be used to determine eligibility for all federally- (and often, state- and university- as well) sponsored programs. To apply for privately-sponsored funds, you have to do your own networking. Search the Internet, haunt your counselor’s office, check out organizations to which members of your family belong. Lots of scholarship money goes unclaimed every year because eligible students don’t know it’s there.