Pell Grants could rise to a maximum $7,395 next year, in the biggest increase in over a decade

Annie Nova @ANNIEREPORTER ,  CNBC – As part of its massive $1.7 trillion spending package for 2023, Congress is planning to up the maximum annual Pell Grant award to $7,395 — a $500 increase from this school year.

If it passes, that would be the largest jump for the grant in more than a decade.

President Joe Biden had previously called to raise the Pell Grant by even more, to a maximum allotment of $8,670 in 2023, and has said he wants to see the payments double by 2029.

Pell Grants are one of the biggest sources of financial aid available to college students, and more than 6 million students received them in 2020.

Each year, Congress decides how much to allocate to the maximum Pell Grant, and in some years it has reduced the payment.

Here’s what to know about the assistance.

Pell Grants could be worth up to $7,395

In the 2023-2024 academic year, Pell Grants could range from a minimum of about $740 to a maximum of $7,395, depending on how much a college calculates that a student’s family will be able to contribute to their college costs, said higher education expert Mark Kantrowitz.

Currently, the most a student can get a year under the program is $6,895.

In some cases, a student can receive more than the maximum aid for a single year if they’re in an accelerated degree program, Kantrowitz added.

Funds help undergrads from ‘low-income families’

More than 90% of Pell Grant recipients in 2015-2016 came from families with household incomes below $60,000, according to Kantrowitz.

“Pell Grants are intended for very low-income families,” Betsy Mayotte, president of The Institute of Student Loan Advisors, previously told CNBC.

The funding is also typically available only to undergraduate college students.