Updated in July 2026

Key Takeaways

• The Pell Grant is the cornerstone of the federal student aid programs, providing need-based grant aid to our country's lowest-income postsecondary students.
• Pell Grants have failed for decades to keep pace with increased college costs.
• Increasing the maximum Pell Grant to $13,000, which would double the maximum grant amount from $6,495 in the 2021-2022 award year, would effectively recalibrate the grant and restore its purchasing power.
• The lowest-income students would benefit most from increasing the maximum Pell Grant, but expanded eligibility would also help moderate-income students, for whom affording college remains a significant challenge.

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Program Background

The federal Pell Grant program is the "foundational" federal student aid program. The program provides grants to undergraduate students with financial need who have not yet earned their first bachelor's degree, to help pay the costs of attending a postsecondary institution. During the annual congressional appropriations process, the minimum and maximum Pell Grant award levels are established for the upcoming award year. During the 2025-26 award year, Pell Grants ranged from $740 to $7,395,¹ and will remain in this range for the 2026-27 award year.² The Pell Grant amount students receive is based on their institution's cost of attendance and their family's financial need, and schools must determine a student's Pell Grant eligibility before calculating eligibility for other federal student aid programs.

In the 2023-24 award year, approximately 6.4 million students received a Pell Grant. During the same year, the average grant amount received was $4,931, and total federal expenditures for the program totaled $31.5 billion.³ The vast majority of Pell Grant recipients come from low-income backgrounds, with 70 percent of recipients during the 2023-24award year having a family income of  $40,000 or less (see Table 1). 

Table 1: Number and Distribution of Pell Grant Recipients by Family Income Level, Award Year 2023-24⁴

Source: U.S. Department of Education, Federal Pell Grant Program End-of-year Report, 2023-24. 

The Pell Grant program plays a critical role in expanding postsecondary access for students from low-income backgrounds and other historically underrepresented student populations. Students of color are more likely to be Pell Grant recipients: nearly 60% of Black students and roughly half of American Indian/Alaska Native and Hispanic students received a grant in the 2019-20 academic year, , compared with just under one-third of white students. The same year, roughly half of first-generation college students and student parents, and almost 40% of student veterans, were Pell Grant recipients (see Table 2).

Table 2:  Percentage of Students Receiving Pell Grants by Demographic Characteristics, Academic Year 2019-20⁵ 

Source: U.S. Department of Education, National Center for Education Statistics, 2019-20 National Postsecondary Student Aid Study (NPSAS:20), First Look at Student Financial Aid Estimates for 2019-20.  

The issue of college affordability in the context of student loan debt has received ever-increasing attention from the media and Congress, yet today's maximum Pell Grant award remains at a level similar to fiscal year (FY) 1978, when adjusting for inflation.⁶ From FY 2014 to FY 2017, the Pell Grant maximum award was indexed to the Consumer Price Index for All Urban Consumers (CPI-U); however, that small boost, which averaged an increase of $69 per year, expired at the end of FY 2017. Since then, Congress has, in some years, passed small increases to the maximum award as part of the annual appropriations process that have barely kept pace with inflation (see Figure 1).

Figure 1: Maximum Pell Grant Award in Current and Inflation-Adjusted Dollars, 2016-17 - 2025-26  

Sources:

• Data from 2016-17 to 2023-24 are from the U.S. Department of Education, Federal Pell Grant Program End-of-year Report, 2023-24.
• Data for the two most recent academic years are from the Federal Student Aid Data Center: GEN-25-02) 2025-2026 Federal Pell Grant Maximum and Minimum Award Amounts (Updated May 29, 2025) and (GEN-24-01) 2024-2025 Federal Pell Grant Maximum and Minimum Award Amounts (Updated April 5, 2024). 
• Inflation-adjusted values are expressed in 2025 dollars by NASFAA using CPI-U based on July of the beginning of each academic year.

Further, the maximum Pell Grant amount has not kept pace with increases in college costs (see Table 3). The 2024-25 maximum Pell Grant of $7,395⁷ covers only 27% of the average cost of attendance at a public four-year institution, while the maximum grant in 1975-76 covered more than three-quarters of the cost of attending a public four-year institution.⁸  Although the small increases passed by Congress in previous years have helped provide momentum for the program, Congress should, at a minimum, increase the maximum Pell Grant by $200 for FY 2027, as an inflationary adjustment, while working toward a maximum award of $13,000. This proposal is long overdue and has been supported by many in the higher education community. This front-end investment in college affordability will take an important first step toward restoring the Pell Grant to its original purchasing power and ensuring more equitable access to postsecondary education for all students who rely on Pell Grants to pursue higher education. 

Table 3. Share of Average Cost of Attendance (COA) Covered by 2024-25 Maximum Pell Grant & $13,000 Maximum Pell Grant 

Sources: U.S. Department of Education, National Center for Education Statistics, IPEDS Data Explorer, Table 10, and (GEN-24-01) 2024-2025 Federal Pell Grant Maximum and Minimum Award Amounts (Updated April 5, 2024). 

Doubling the Maximum Pell Grant: A Necessary Investment

Increasing the maximum Pell Grant to $13,000, which would double the maximum grant amount from $6,495 in the 2021-2022 award year, would increase the grant amounts received by current recipients.  This increase in the maximum award would also extend eligibility to some additional, moderate-income students who do not currently qualify for the grant.

Along with increasing the maximum Pell Grant to $13,000, NASFAA recommends lawmakers consider enacting a minimum Pell Grant award of 5% of the maximum award (rather than the current 10%). This would allow more students to receive a grant, maintain the minimum award at a level closer to its current level, and eliminate the possibility of a steep eligibility cliff for students whose Student Aid Index (SAI) falls just outside the Pell-eligible range.

While costly, providing robust increases to the Pell Grant simply makes up for necessary investments in federal student aid that have been pushed off for decades. Increasing the Pell Grant targets students with the greatest financial need and represents a sustainable, front-end approach to improving college access and affordability for lower-income students.

The Pell Grant program's discretionary funding, which accounts for the majority of each year's maximum award, has remained relatively flat for several years. Appropriators are unlikely to have room in their annual budget allocations to cover the cost of this increased Pell approach through discretionary increases alone. Consequently, program investments of this nature will likely require mandatory investments. NASFAA has long supported transitioning the Pell Grant program to fully mandatory funding to align its structure with how it operates — as an entitlement

What Congress Can Do

• Congress should re-commit to the original intent of the Pell Grant program by, at a minimum, increasing the maximum Pell Grant by $200 for FY 2027 as an inflationary adjustment, while working towards a maximum grant amount of $13,000 to restore its purchasing power for low- and moderate-income students struggling to meet college costs.
• Congress should restore the 5% minimum Pell award, as was in place prior to the Higher Education Opportunity Act of 2008, to smooth out steep eligibility cliffs that would result from doubling the Pell Grant. 
• Congress should transition the Pell Grant program to fully mandatory funding and reinstate the automatic inflation adjustment to the maximum award to ensure the grant maintains its purchasing power over time.
• Congress should address the projected Pell Grant shortfall by ensuring the program is on a strong financial footing without cutting the maximum award or limiting program eligibility.

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1. ^{(GEN-25-02) 2025-2026 Federal Pell Grant Maximum and Minimum Award Amounts (Updated May 29, 2025)} 
2. ^{(GEN-26-01) 2026-2027 Federal Pell Grant Maximum and Minimum Award Amounts (Updated Feb 18, 2026)}
3.  ^{U.S. Department of Education, Federal Pell Grant Program End-of-year Report, 2023-24}
4. ^{Although more recent Pell Grant data is available, Table 1 uses 2023-24 data in order to maintain consistency with the most recent Title IV Program Volume Reports (Published May 20, 2025).}
5. ^{The most recent data available from the National Center for Educational Statistics is from the U.S. Department of Education, 2019-20 National Postsecondary Student Aid Study (NPSAS:20).}
6. ^{The 1978 Federal Pell Grant maximum of $1,400 (U.S. Department of Education, Pell Grant Program End of Year Report 1980-81) equals $7,095 in 2026 dollars, adjusted using the Consumer Price Index for All Urban Consumers (CPI-U) annual averages (Federal Reserve Bank of Minneapolis, "Consumer Price Index, 1913-,").}
7. ^{(GEN-25-02) 2026-2027 Federal Pell Grant Maximum and Minimum Award Amounts (Updated Feb 18, 2026); although the maximum Pell Grant award for 2025-26 and 2026-27 is also $7,395, this analysis uses the maximum grant from 2024-25 to maintain consistency with the most recent Cost of Attendance (COA) data available from the National Center for Education Statistics (NCES).}
8. ^{See Table 3; 2019 Digest of Education Statistics.}