Pell Grants could increase to $7,395 for the 2023-24 academic year

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As part of its massive $1.7 trillion spending package for 2023, Congress is planning to up the maximum annual Pell Grant award to $7,395 — a $500 increase from this school year.

If it passes, that would be the largest jump for the grant in more than a decade.

President Joe Biden had previously called to raise the Pell Grant by even more, to a maximum allotment of $8,670 in 2023, and has said he wants to see the payments double by 2029.

Pell Grants are one of the biggest sources of financial aid available to college students, and more than 6 million students received them in 2020.

Each year, Congress decides how much to allocate to the maximum Pell Grant, and in some years it has reduced the payment.

Here’s what to know about the assistance.

Pell Grants could be worth up to $7,395

Funds help undergrads from ‘low-income families’

You must submit a FAFSA to qualify

There’s a limit to how many Pell Grants you can get

How aid is paid depends on your college

At most colleges, the grant is given out in two disbursements, at the start of each term, Kantrowitz said.

“However, many colleges prefer to make monthly or biweekly disbursements,” he added. “This is often called ‘Pell as a paycheck.'”  

Funds typically cover tuition, but other expenses qualify

Pell Grant funds are applied first to tuition and fees, Kantrowitz said. Any college-owned or -operated housing could also be covered by the aid.

If there’s still money left over after those costs are covered, it’s usually disbursed to the student within 14 days, Kantrowitz said.

“The student can then use the money to pay for other college costs, such as textbooks,” he said.

You usually don’t have to pay the money back

A federal Pell Grant, unlike a student loan, typically doesn’t have to be repaid.

The exceptions are rare, and include cases in which your enrollment status changed from full time to part time or if you left a program early.

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