One of the most important things you must understand about the Pell Grant is that it is your EFC that plays the most crucial role in determining your Pell Grant eligibility, and the actual Pell Grant amount you are able to receive. Remember that the Pell Grant is a need-based federal grant, and your ability to show the appropriate financial need is vital to becoming eligible and receiving the most aid you possibly can via this award.
That being said, most students still get confused when they hear the mentioning of EFC, and in reality this shouldn’t happen because the EFC metric is very simple to understand when you put it into perspective.
EFC Plays Two Roles
EFC has two distinct effects on the Pell Grant. It first plays a large role in determining eligibility by setting a cutoff threshold for the award. This is now set at 5,273 for the 2010-11 school year, and if your EFC is above this amount you won’t be able to qualify for a Pell Grant.
Once your EFC has made you eligible to receive the grant, it will then play a significant role in determining the actual amount of funding you are able to receive. Your school will take into consideration your EFC, the cost of attendance of attending your school, and your enrollment status to ultimately determine the amount of Pell Grant money you are able to receive for that school year, and among these, your EFC will play the most crucial role, with lower EFC values translating into higher Pell Grant amounts.
Calculating EFC
So you now may be wondering how your EFC is calculated. The EFC is a product of a number of factors that include your parent’s income (and assets if you’re still a dependent), your income (and assets if you’re an independent), the size of your family’s household, and the number of family members who are currently attending postsecondary institutions. Other factors that may play a role include the status of your parents’ income taxes for the previous year, whether or not both of your parents work, and your parents’ age.
All of this information is collected when you fill out a FAFSA, and your EFC will be calculated upon submission of this application. The SAR, or Student Aid Report will be generated upon completion of your FAFSA, and from within in it you’ll be able to see what your EFC is for that particular school year, so make sure to check your SAR if you want to know what your EFC is specifically.
