The Pell Grant is one of the most important financial aid tools for low- and moderate-income U.S. undergraduates. Unlike loans, it does not have to be repaid. In this guide, we’ll explain how Pell Grants work, recent updates for the 2025–2026 award year, eligibility criteria, how to apply, and key policy changes to watch.
What Is the Pell Grant?
- A Pell Grant (officially, the Federal Pell Grant) is a need-based grant provided by the U.S. Department of Education.
- It’s designed for undergraduate students who have not earned a bachelor’s (or professional) degree. (FSA Partner Connect)
- Since it’s a grant (not a loan), you don’t have to pay it back, making it especially valuable for qualifying students. (Scholarships360)
Pell Grant Amounts for 2025–2026
- For the award year 2025–2026, the maximum Pell Grant is $7,395. (FSA Partner Connect)
- The minimum Pell Grant award is $740, calculated as 10% of the maximum, per federal formula. (FSA Partner Connect)
- Students may be eligible to receive up to 150% of their scheduled Pell Award in a year under certain “year-round Pell” rules. (FSA Partner Connect)
- However, note that Pell Grant funding and maximum awards depend on Congressional appropriations. (FSA Partner Connect)
Who Is Eligible for a Pell Grant?
To qualify for a Pell Grant, students must:
- Be an undergraduate — you must not already hold a bachelor’s or other professional degree. (FSA Partner Connect)
- Fill out the FAFSA (Free Application for Federal Student Aid) — this determines your “Student Aid Index” (SAI), which affects the amount of Pell you get. (FSA Partner Connect)
- Demonstrate financial need, based on your SAI, family size, and other factors. (FSA Partner Connect)
- Stay within your Pell “lifetime eligibility” — Pell Grants are limited by semesters used (often expressed as a percentage or number of terms). (NASFAA)
How the Pell Grant Is Calculated
- Your Scheduled Award (the Pell amount you’re eligible for before adjustments) can be one of three values:
- The Maximum Pell amount;
- A value based on SAI — calculated as Max Pell minus your Student Aid Index, then rounded to the nearest $5. (FSA Partner Connect)
- The Minimum Pell, if your SAI-calculated amount falls below the min but you still meet eligibility. (FSA Partner Connect)
- For part-time students or those in term-based programs, the award may be pro-rated based on enrollment intensity. (FSA Partner Connect)
Key Policy & Recent Updates (2025-2026)
- Funding and Award Stability
- The Pell Grant maximum of $7,395 for 2025–2026 is based on current appropriations. (FSA Partner Connect)
- There is some urgency because certain funding laws expire March 14, 2025, and Congress would need to act to maintain these grant levels. (FSA Partner Connect)
- FAFSA Simplification & SAI Changes
- The FAFSA Simplification Act continues to influence how Pell is calculated. Rather than an older “EFC,” the Student Aid Index (SAI) is used now, which can change how much aid a student gets. (FSA Partner Connect)
- For 2026–2027, new Pell eligibility rules will take effect under the “One Big Beautiful Bill Act”:
- Legislative Proposals to Expand Pell
How to Apply for a Pell Grant
- Fill Out the FAFSA
- Go to StudentAid.gov and complete your FAFSA for the relevant award year.
- Your financial data (income, family size, assets) will be used to compute your SAI, which determines Pell eligibility.
- Review Your Award Notification
- After your school processes your FAFSA, they will send a financial aid offer that may include Pell Grant funds (if you qualify).
- Confirm the amount, and make sure you understand whether it’s “Scheduled Award” or what you’ll actually receive.
Read Also: Federal Student Loans — Complete, Up-to-Date Guide (2025)
- After your school processes your FAFSA, they will send a financial aid offer that may include Pell Grant funds (if you qualify).
- Maintain Eligibility
- To keep receiving Pell, you usually need to maintain satisfactory academic progress at your college.
- Also, track your “lifetime Pell usage” to ensure you don’t exceed the maximum number of semesters or percentage allowed.
Why the Pell Grant Matters
- No Repayment Required: Because it’s a grant, you don’t pay it back — making it highly beneficial. (Scholarships360)
- Foundation of Federal Aid: For many low-income undergraduates, Pell is the cornerstone of their financial aid package.
- Supports Higher Education Access: By helping students cover part of their tuition or cost of attendance, Pell enables students to go to college who might not otherwise afford it.
Risks & Things to Watch
- Legislative Uncertainty: Because Pell funding comes from Congress, changes or lapses in funding could affect maximum awards. (FSA Partner Connect)
- SAI Thresholds Tightening: With new laws (like the “One Big Beautiful Bill Act”), eligibility may become stricter for students with higher SAIs. (NASFAA)
- Lifetime Usage Limit: Students must be careful about how many semesters they use Pell — there’s a cap. (NASFAA)
- Enrollment Intensity: Part-time or term-based enrollment could reduce your Pell award because it’s pro-rated. (FSA Partner Connect)
Useful External Links
- StudentAid.gov – Official site to apply for aid and learn more about Pell Grants.
- 2025–2026 Pell Grant Maximum/Minimum Announcement – Official Dept. of Education letter. (FSA Partner Connect)
- Federal Student Aid Handbook – Pell Eligibility – Detailed rules on who qualifies. (FSA Partner Connect)
- NASFAA Commentary on Future Pell Changes – How new legislation affects Pell and SAI. (NASFAA)
Final Thoughts
- The Pell Grant continues to be a critical, non-repayable aid source for many U.S. undergraduates, especially those with financial need.
- For 2025–2026, the maximum award remains $7,395, with a minimum of $740. (FSA Partner Connect)
- However, policy changes are on the horizon (e.g., via the One Big Beautiful Bill Act) that could affect eligibility, how SAI is calculated, and who gets maximum grants. (NASFAA)
- If you’re applying, make sure to fill out FAFSA accurately, check your school’s financial aid offer, and understand your Pell “lifetime eligibility.”
