Grants

Paying for continuing education can be an overwhelming task. Rates for a college or university education are mounting every year. Some parents start saving for their children's education before the kids even start grade school. But sometimes savings isn't enough, or has to be used for other purposes. This doesn't mean you or your child can't get continuing education. There are other ways to pay for school than out of your own pocket. Scholarships, education reimbursement programs, and student financial aid can all contribute to significantly lightening the financial load. The federal and state governments have recognized that the cost of education can be grueling for some families and have offered to assist those of low income to better their circumstances through a college education. The federal and state grant programs have been established for this purpose. Below are the answers to some basic questions about grants.

What are Grants?

A grant is free money from the government or an institution to help you meet your education goals. Most grants are for undergraduate studies, though some graduate grants are available. A grant is not a loan because the money never has to be repaid. Unlike scholarships, it is awarded based on need or area of study rather than academic or athletic performance. The government and other institutions award grants on a first come first serve basis, so applying for grants must be done as soon as the application is available for the school year in which assistance is needed. Most grants are applied for through your college's or university's student financial aid office.

What types of Grants can you apply for?

There are four major types of grants, all of which rely on similar application processes and supplemental forms. The four major types of grants are: Federal Pell Grants, Federal Supplemental Education Opportunity Grants, State Grants, and Institutional Grants.

The Federal Pell Grant Program is by far the largest and most well-known of the grant programs. Pell grants can range in amount from a few hundred to several thousands of dollars per semester based solely on the need of the student. The actual grant amount is determined by the college or university which you are attending and applying through. The college or university gives out monies using federal guidelines. Eligible colleges which participate in the grant program receive a fixed amount of funds every year for student aid. Once the grant money for the college is gone, it's gone, which is why it pays to apply early. If you apply too late, there may not be any money left for that school year. Sometimes the deadline for Student Aid applications is not a good indicator of whether there is money to be had or not. You can only apply for a Federal Pell Grant through one college or university per year. You may also be awarded an additional federal grant if you are a math or science major. As of 2006 the federal government now offers Academic Competitiveness Grants and National SMART Grants which can be thousands of dollars awarded in addition to the Federal Pell Grant.

Federal Supplemental Education Opportunity Grants are reserved for the neediest of students. Grant amounts are between $100 and $4000. These are awarded through the same application system as the Federal Pell Grants and awarded by the college or university you are attending.

State grant programs are targeted for need-based students, though some states have grant programs that encourage particular areas of study such as teaching, such as California, or the sciences. State grants can range from a few hundred dollars to several thousand. Some states will even assume responsibility for the payment of your student loans based on your area of study and where you work after graduation. Teachers working in low-income areas in California can have up to $19,000 in student loans repaid by the state. To check for the grants available in your state and apply for them, go to state's student-aid or higher education commission office or website.

Some colleges or universities will also offer institutional grants. These vary from institution to institution and are often awarded to supplement what costs the federal and state grants do not cover for the school year. Institutional grants are awarded based on need or as an inducement to the student to attend their school. If a highly sought after student needs to take out loans in order to complete their continuing education, an institution will often award these grants in lieu of loans. These grants are typically not something you apply for, though you can increase your chances of receiving one by applying to schools that will want you rather than schools you struggle to get into.

How do you apply for a need-based grant?

Need-based Federal Pell Grants are awarded in amounts based off of three things. Those three things are your expected family contribution (EFC), the cost of attendance at the institution you go to, and your student enrollment status of either full-time or part-time. These three things are determined and all of your personal and school information is collected as you fill out the Free Application for Federal Student Aid, or FAFSA. The FAFSA is used to help determine whether you qualify for free aid and the rate at which you can get a federal student loan.

Your EFC is determined by a formula laid out by the U.S. Department of Education and either your tax return for the previous year if you are independent of your parents, or your parents' tax return if you are still claimed as their dependant. The formula takes into account the student or parents' net income minus living expenses, the student's savings and other assets, the student's household's size and how many other family members (excluding parents) are attending college or other postsecondary institutions. Different assessment rates are used to determine the EFC for dependant students, independent students without dependants, and independent students with dependants. After your information is accumulated and your EFC determined, you and your school are sent a student aid report (SAR) telling you whether you qualify for a Federal Pell Grant. Based on you EFC which is reported in the SAR, your school determines how much you will be awarded and distribute it to you.

Education focus specific grants such as the SMART Grant are also awarded through the FAFSA and SAR system. Other need-based grants you can apply for through the state or your college or university are awarded based off of the same information collected on the FAFSA, though your student aid office may require you to fill out separate forms from the FAFSA in order to apply for these grants.

What will improve your chances for qualifying for a grant?

You can help yourself qualify for a grant more easily by making sure your FAFSA is submitted as soon as possible. You can submit the FAFSA for the upcoming school year as of the January 1st before the school year begins. If you do submit it then, you can use estimated numbers for your tax information and update it when your taxes are completed, just be sure your numbers are at least close to what they will be, or get your taxes done first. The earlier you submit your FAFSA information the better your chances for qualifying for a grant. As was mentioned before, schools award federal student aid based on a first come first serve basis and when the money is gone, it's gone for the year. As more money is given out, the restrictions on who qualifies for federal student aid tighten. Get your application in early and you can save yourself a bundle with a grant.

To make sure you improve your chances for qualifying for a grant, be honest with all the information you use to fill out the grant application. If you are not honest with any part of the application, you can be sure you will be disqualified from the grant awards process. Be especially careful on the tax information portion of your application. Double check your work and be sure all of your personal information is there and correct. Making yourself look poorer than you truly are is not a good idea when it comes to applying for student aid.

There is more student aid in the form of grants available than just the Federal Pell Grant. Research what you can qualify for and apply. The student aid office at your school should have access to all the information you need to find grants you can qualify for, and they'd be happy to assist you in finding money that you can go to school on. You can also research online. The four types of grants mentioned above are just the major types of grants. There are more grants out there that don't fall under any of those four categories. With a little research can be found. There are grants available for just about every avenue of study, though there are more so for some areas than others.