Wondering how the amount of your federal
student aid is determined?
The colleges or career schools you list on your Free Application for Federal Student Aid
(FAFSASM) will use several pieces of information to calculate your aid.
So, you’ve filed your FAFSASM, and you’ve checked your Student Aid Report to be sure all your
information is correct, and now you’re wondering how that data is used to come up with the list
of financial aid for which you’re eligible.
If I meet the basic eligibility criteria for federal student aid, who decides how much money I’ll
get?
What does cost of attendance (COA) mean?
What’s the Expected Family Contribution (EFC)?
What is need-based aid and how does my school figure out how much I’ll get?
What is non-need-based aid and how does my school figure out how much I’ll get?
If I meet the basic eligibility criteria for federal student aid,
who decides how much money I’ll get?
Here’s the short answer:
Your eligibility depends on your Expected Family Contribution, your year in school, your
enrollment status, and the cost of attendance at the school you will be attending. The financial
aid office at your college or career school will determine how much financial aid you are eligible
to receive.
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The financial aid staff starts by deciding upon your cost of attendance (COA) at that
school.
They then consider your Expected Family Contribution (EFC).
They subtract your EFC from your COA to determine the amount of your financial need
and therefore how much need-based aid you can get.
To determine how much non-need-based aid you can get, the school takes your cost of
attendance and subtracts any financial aid you’ve already been awarded.
If you’d like the long answer, keep reading!
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What does cost of attendance (COA) mean?
Your COA is the amount it will cost you to go to school. Most two-year and four-year colleges
will calculate your COA to show your total cost for the school year (for instance, for the fall
semester plus the spring semester). Schools with programs that last a different period of time (for
instance, an 18-month certificate program) might give you a COA that covers a time period other
than a year.
If you're attending at least half-time, your COA is the estimate of
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tuition and fees;
the cost of room and board (or living expenses for students who do not contract with the
school for room and board);
the cost of books, supplies, transportation, loan fees, and miscellaneous expenses
(including a reasonable amount for the documented cost of a personal computer);
an allowance for child care or other dependent care;
costs related to a disability; and/or
reasonable costs for eligible study-abroad programs.
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What’s the Expected Family Contribution (EFC)?
Your EFC is an index number that college financial aid staff use to determine how much
financial aid you would receive if you were to attend their school. The information you report on
your FAFSA is used to calculate your EFC.
The EFC is calculated according to a formula established by law. Your family's taxed and
untaxed income, assets, and benefits (such as unemployment or Social Security) all could be
considered in the formula. Also considered are your family size and the number of family
members who will attend college or career school during the year. The EFC Formula guide
shows exactly how an EFC is calculated.
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Your EFC is not the amount of money your family will have to pay for college, nor is it the
amount of federal student aid you will receive. It is a number used by your school to calculate
how much financial aid you are eligible to receive.
What is need-based aid and how does my school figure out
how much I’ll get?
Your college or career school first determines whether you have financial need by using this
simple formula:
Calculating Your Financial Need
Cost of Attendance (COA)
– Expected Family Contribution (EFC)
= Financial Need
Need-based aid is financial aid that you can receive if you have financial need and meet other
eligibility criteria. You can’t receive more need-based aid than the amount of your financial
need. For instance, if your COA is $6,000 and your EFC is 2000, your financial need is $4,000;
so you aren’t eligible for more than $4,000 in need-based aid.
The following are the need-based federal student aid programs:
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Federal Pell Grant
Federal Supplemental Educational Opportunity Grant (FSEOG)
Direct Subsidized Loan
Federal Perkins Loan
Federal Work-Study
What is non-need-based aid and how does my school figure
out how much I’ll get?
Your school determines how much non-need-based aid you can get by using this formula:
Calculating Your Non-need-based Aid
Cost of Attendance (COA)
– Financial Aid Awarded So Far*
= Eligibility for Non-need-based Aid
*includes aid from all sources, such as the school, private scholarship providers, etc.
Non-need-based aid is financial aid that is not based on your EFC. What matters is your COA
and how much other assistance you’ve been awarded so far. For instance, if your COA is $6,000
and you’ve been awarded a total of $4,000 in need-based aid and private scholarships, you can
get up to $2,000 in non-need-based aid.
The following are the non-need-based federal student aid programs:
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Direct Unsubsidized Loan
Federal PLUS Loan
Teacher Education Access for College and Higher Education (TEACH) Grant
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A school’s financial aid staff can consider circumstances such as unusual medical expenses,
tuition expenses, or unemployment and can adjust your COA or some of the information used to
calculate your EFC.
Glossary
FAFSA
Free Application for Federal Student Aid
Financial Aid Office
The office at a college or career school that is responsible for preparing and communicating
information on financial aid. This office helps students apply for and receive student loans,
gran...
Financial Need
The difference between the cost of attendance (COA) at a school and your Expected Family
Contribution (EFC). While COA varies from school to school, your EFC does not change based
on the scho...
Room and Board
An allowance for the cost of housing and food while attending college or career school.
Federal Student Aid Programs
The programs authorized under Title IV of the Higher Education Act of 1965 that provide grants,
loans and work-study funds from the federal government to eligible students enrolled in college
or ca...
Scholarship
Money awarded to students based on academic or other achievements to help pay for education
expenses. Scholarships generally do not have to be repaid.
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Calculation of Pell Grant Lifetime Eligibility Used
Did you know there’s a maximum amount of Federal Pell Grant funds you can receive over
your lifetime?
Learn what the Federal Pell Grant limits are and how your remaining eligibility is calculated.
The amount of Federal Pell Grant funds you may receive over your lifetime is limited by a new
federal law to be the equivalent of six years of Pell Grant funding. Since the maximum amount
of Pell Grant funding you can receive each year is equal to 100%, the six-year equivalent is
600%.
How is my Federal Pell Grant Lifetime Eligibility Used (LEU) calculated?
How can I see my LEU percentage?
How can I learn more about Federal Pell Grants?
How is my Federal Pell Grant Lifetime Eligibility Used
calculated?
Scheduled award: The maximum amount of Federal Pell Grant funding you can receive is
calculated for an award year. An award year is a period from July 1 of one calendar year to June
30 of the next calendar year.
Your scheduled award
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is partially determined by using your Expected Family Contribution (EFC) that is
calculated from the information you (and your family) provided when you filed your
Free Application for Federal Student Aid (FAFSASM);
is the maximum amount you would be able to receive for the award year if you were
enrolled full-time for the full school year; and
represents 100% of your Pell Grant eligibility for that award year.
Percent used: To determine how much of the maximum six years (600%) of Pell Grant you have
used each year, the U.S. Department of Education (ED) compares the actual amount you
received for the award year with your scheduled award amount for that award year. Of course, if
you receive the full amount of your scheduled award, you will have used 100%. It’s possible that
you might not receive your entire scheduled award for an award year. There are a number of
reasons for this, the most common of which are that you are not enrolled for the full year or that
you are not enrolled full-time, or both.
If you did not receive the full amount of your scheduled award, we calculate the percentage of
the scheduled award that you did receive. For example, if your scheduled award for an award
year is $5,000, but because you were enrolled for only one semester you received only $2,500,
you would have received 50% of the scheduled award for that award year. Or if you received
only $3,750 for the award year because you were enrolled three-quarter-time and not full-time,
you would have received 75% for that year.
Lifetime Eligibility Used (LEU): ED keeps track of your LEU by adding together the
percentages of your Pell Grant scheduled awards that you received for each award year. The
table below shows examples of the LEUs of three students who received differing amounts of
their scheduled awards over a four-year period.
Examples of Pell Grant Lifetime Eligibility Used Student A Student B Student C
Pell Grant Scheduled Award
$5,550
$5,000
$4,000
Award Year 1
Pell Grant Amount Received
$2,775
$3,750
$4,000
Percent Used
50%
75%
100%
Pell Grant Scheduled Award
$5,200
$5,000
$5,550
Award Year 2
Pell Grant Amount Received
$5,200
$5,000
$5,550
Percent Used
100%
100%
100%
Pell Grant Scheduled Award
$4,700
$5,000
$5,550
Award Year 3
Pell Grant Amount Received
$4,700
$1,250
$5,550
Percent Used
100%
25%
100%
Pell Grant Scheduled Award
$4,700
$5,000
$5,550
Award Year 4
Pell Grant Amount Received
$4,700
$5,000
$5,550
Percent Used
100%
100%
100%
Total Lifetime Eligibility Used — LEU
Note: From 2009–10 through 2010–11, it was
possible for a student to receive up to two
scheduled awards in a year. So some students will
have a “percent used” of up to 200% for one or
more of those years.
350%
300%
400%
If your LEU equals or exceeds 600%, you may no longer receive Pell Grant funding. Similarly,
if your LEU is greater than 500% but less than 600%, while you will be eligible for a Pell Grant
for the next award year, you will not be able to receive a full scheduled award.
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How can I see my Lifetime Eligibility Used (LEU)
percentage?
You can log on to National Student Loan Data System (NSLDS®) using your Federal Student
Aid PIN and view your LEU. The LEU will be found on the Financial Aid Review page.
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How can I learn more about Federal Pell Grants?
Learn more about Federal Pell Grants and how much you might receive in a year. If you have
questions regarding your Pell Grant or the LEU, you can also contact your college’s or career
school’s financial aid office.