When gathering the money you need to pay for college, it’s important to know the amount of federal financial aid that may be available to you. Each year, grant amounts and student loan interest rates are subject to change. Here’s what you can expect for Academic Year 2020-2021.
- The Federal Pell Grant: Available to students who qualify based on the level of their financial need as determined by Federal Student Aid, a division of the U.S. Department of Education. Beginning July 1, 2020, the maximum allowable Pell amount you may be able to receive for one year of college is $6,345, which is an increase over the maximum of $6,195 for Academic Year 2019-2020.
- The Federal Work-Study Program: If your campus administers work-study funds, you may be able to sign up for a part-time job, either on-campus or an approved site off-campus, enabling you to earn money to pay for some of your college expenses. The maximum amount you can earn in the work-study program will be determined by your level of financial need.
- Federal Student Loans: To provide relief to student loan borrowers during the COVID-19 national emergency, interest is being temporarily set at 0% on federal student loans borrowed before July 1, 2020. In addition, federal student loan borrowers are automatically being placed in an administrative forbearance, which allows you to temporarily stop making your monthly loan payments. This 0% interest and suspension of payments will last from March 13, 2020, through September 30, 2020, but you can still make payments if you choose.
The following table outlines the projected federal student loan interest rates for Academic Year 2020-2021, which show a decrease from last year’s rates:
|Loan Type||Borrower Type||Fixed Interest Rate|
|Direct Subsidized and Unsubsidized Student Loans||Undergraduate students (up to Bachelor’s degree)||2.75%|
|Direct Unsubsidized Student Loan||Graduate or professional students||4.30%|
|Direct PLUS Loan||Parents of undergraduate students OR graduate/professional students||5.30%|
Be sure to visit StudentAid.gov for up-to-date information regarding interest rates and special allowances due to the COVID-19 pandemic.