There's a saying: "If you think education is expensive, consider the price of ignorance." Wise words, to be sure, but many college-bound students and their families may feel the gap is narrowing. Whatever the price of ignorance may be, education is catching up. A year's tuition and fees average $7,000 at a four-year state school, and it can be more than $26,000 at a private institution. That's an annual increase of 6.5 percent and 4.4 percent, respectively [source: The College Board]. It's no surprise, then, that "What financial aid can I get?" is as big a question for higher education as "What courses should I take?"
Student financial aid in the U.S. predates the nation's founding: Students at Harvard College (now Harvard University) received private scholarships in 1643 [source: Harvard University]. The GI Bill of Rights of 1944, authorizing federal funds to help military veterans pay tuition and living expenses, marked a turning point. It sent the message that higher education ought to be accessible to everyone. Twenty years later, the Higher Education Act of 1965 extended federal student aid to working- and middle-class families. In signing the Act, President Lyndon Johnson voiced a growing national sentiment: "Education in this day and age is a necessity" [source: Lyndon Baines Johnson Library and Museum].
Today, the federal government plays a major role in making college education affordable. Almost one-half of all undergraduates (those pursuing an associate or bachelor's degree) receive federal student aid [source: U.S. Department of Education].
Like private assistance, government funding consists largely of loans and grants. Loans must be repaid, usually with interest. In contrast, grants are outright awards with no financial strings attached, a boon to students whose finances are the tightest. About one-quarter of all undergraduates take advantage of the Pell Grant, the largest federal grant program [source: Indiana University].
Along with the Pell is another program: the Federal Supplemental Educational Opportunity Grant (FSEOG). As the name suggests, the FSEOG is meant to supplement other financial aid. It covers educational expenses not met by a student's loans, scholarships or other grants. The program doled out almost $1 billion to more than 1.25 million students in 2009-2010.
Who qualifies for an FSEOG? How much is it worth? What does the application process involve? As you'll see, an FSEOG may be "free money," but it's not just there for the taking.
First, we look at two determining factors: availability and eligibility.