US students pursuing higher education can access government financial aid through grants or loans. Completing the FAFSA is necessary to be considered for aid, including scholarships and loans such as Perkins, Stafford, and PLUS loans. Pell Grant recipients may also be eligible for additional scholarships. The TEACH Grant requires a commitment to teach in a high-need field or low-income school.
In the United States, there are several types of government financial aid that are available to students who are pursuing higher education. Government financial aid is given to students through grants or loans. Donations are gifts and do not need to be repaid while loans need to be repaid to the government. To be considered for any type of government financial aid, you must complete the Free Application for Federal Student Aid, which is commonly referred to as the FAFSA.
There are several types of scholarships available for college bound students and most of them are based on the financial need of the student. Once a student’s need is assessed by completing the FAFSA, they can receive a Pell Grant, which is the basis of government financial aid to students. After determining whether a student is a Pell Grant recipient, other forms of assistance can be added.
Pell Grant recipients in dire need are eligible to receive a Federal Supplemental Educational Opportunity Grant (FSEOG), which will help offset the cost of a college education. Other scholarships for which Pell Grant recipients are eligible are an Academic Competitive Scholarship and a National Science and Mathematics Access Scholarship for Talent Retention (SMART National Scholarship). Academic Competitive Scholarships require a student to have completed a rigorous high school program and be in the first or second year of a four-year program. National SMART Grant recipients must be in their third or fourth year of study in science, math, engineering, technology or a critical foreign language.
The Teacher Education Assistance for Higher Learning and Higher Learning Grants (TEACH Grant) does not require the student to be a Pell Grant recipient. Instead, the student must be enrolled in an undergraduate or graduate education program and commit to teaching in a high-need field or at a primary or secondary school that serves low-income students one year per year in that the subsidy was received. If the commitment is not met, the TEACH grant will be converted to a federal student loan for full repayment.
Student loans are also a significant part of government financial aid programs. Perkins Loans are low interest loans available to undergraduate and graduate students with significant financial need. In addition, Federal Family Education Loans (FFEL) and William D. Ford Federal Direct Loans are available to students. Direct loans and FFEL loans are called Stafford loans. Stafford loans can be subsidized on an as-needed basis, which means that the federal government pays the interest on the loan while the student attends school.
The final type of government financial aid for college is a PLUS loan. PLUS loans are taken out by parents of dependent undergraduate or graduate students. PLUS loans are different from Stafford loans because they require a creditworthy borrower or co-signer, where Stafford loans are need-based only.
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