While it is hard to know just how much the U.S. government issues in federal grants each year, we can assume it's a pretty big number. And after you review the situation with unclaimed government aid for college students outlined below, you'll realize how big the number must be just in the amount of unclaimed Federal Pell Grants.
Government grants are offered nationally, state-wide, and locally and are intended to benefit a project of some design. And a grant is a gift, with no repayment terms. There are thousands of grants extended each year in the United States for public services and economic stimulation, but if not one ever applies, they go unclaimed.
To find out if you are eligible for a grant, you can learn more about eligibility requirements here. Keep in mind that grants won't just come to you; you need to seek them out and apply. So, once you have identified relevant grants and have confirmed your eligibility, be sure to start the grant application process. Because grants are a gift that do not require repayment and have strict rules on what does or does not qualify, the application process can be lengthy and tedious, and often times, applicants will hire freelancers to help write grant letters on their behalf. But again, you'll never have an opportunity to receive a grant if you don't try.
Start your grant search at Grants.gov. Watch the various training videos and read the various articles on the website to make sure you are fully educated before beginning the application process. The Overview of the Application Process video is brief and will help prepare you for the application. Further, the Grants Learning Center will tell you how to register with Grants.gov, which is a critical step before completing the application process.
Unclaimed government aid for college students
Take for example that in 2013, over $2.9 billion was missed out on for Pell Grant aids alone. Federal Pell Grants are the most common student grants and are awarded exclusively on financial need. These grants do not consider your grades, extra-curricular activities, etc. In 2018, it is estimated that $2.6 billion went unclaimed, so we haven't made much improvement over the last five years.
And this while problem could be avoided if more students would go through the process of completing the FAFSA (Free Application for Federal Student Aid). The FAFSA process is a critical part of the college application process, and the generally opens in January of each year, for the coming academic year. The FAFSA is completed once per year, and generally takes one to three hours to complete (a bit less for students after their first year).
Colleges begin working on financial aid packages for students in January or February of each year and then start issuing financial aid letters in March and April. Then, students will usually have until May 1 to decide whether or not to accept a package from a particular college or university; this day is often referred to as Decision Day.
Many people confuse the FAFSA process with an actual loan. But, the FAFSA is simply the process that you must undertake so that colleges and the government can best determine the aid package that is right for you. But many students also don't understand that the FAFSA process is critical in a school's ability to determine if you quality for a grant. And with a grant, you don't need to pay it back.
This online FAFSA tracker provides interesting insights into FAFSA completion by state. Completion rates tend to be highest in Tennessee with a 76% completion rate, but Alaska only shows a 30% completion rate. These are unfortunate statistics as the FAFSA is free to complete and nearly everyone who applies will receive aid of some sort. Even more unfortunate is that many students never consider college due to financial hardship, and therefore never explore their options, and thus never realize that there was money available for them.
Unclaimed money from the government
In addition to unclaimed college grants, there are millions of dollars sitting in old bank accounts, from unpaid wages, from life insurance funds, from tax refunds, etc. While searching for unclaimed funds can be a bit daunting, more and more services are being made available to help.
The steps to looking for unclaimed money are as follows:
- Search in your state for any unclaimed money. You can go to www.unclaimed.org to conduct a search.
- If you have not received a tax refund from the IRS, visit the IRS Where's My Refund site. Every year, hundreds of tax returns are returned to the IRS for deliverability reasons.
- If you are retired or are close to retiring and have changed jobs a few times during your career, be sure that you have kept track of your various retirement plans and accounts. If you have not, or want to double check to be sure, check out the National Registry of Unclaimed Retirement Benefits.
- And speaking of retirement, what about those life insurance benefits? It isn't at all that uncommon for life insurance to go unclaimed. If you have had a relative pass away, start your search at demutualization-claims.com.
- If you have changed banks one or more times in the past, it is possible you have unclaimed funds sitting in old accounts. Don't assume you didn't forget about these; life gets busy and sometimes these things simply pass us by. Check out http://www.missingmoney.com/ to research any old bank accounts.
- Even the US Treasury states that they have unclaimed funds, indicating that 25,000 payments of various types are returned each year for deliverability reasons. And don't forget those old savings bonds that were so popular. These have likely been filed deep in the back of a safe or at a bank in a safety deposit box. If you still have savings bonds and they have reached or are past maturity, you should cash them in or reinvest them. If you can't locate your bonds, you can contact the Treasury's Bureau of the Fiscal Service.
