Federal grants are given by the federal government (of course!) to many different areas of need, with one purpose and that is to stimulate productivity within the country and the world from which they are counting on reaping more profits. Instead of the government saying to themselves “it is better to give than to receive,” they are saying instead—“it is better to receive than give but the only way we are going to receive maximally is by giving first and hopefully in relatively smaller amounts.

Federal grants are given for many different things including but not limited to the following: student financial aid, research, small businesses, the arts, agriculture, health care research and provision, economic incentives, real estate investing and improvement, public housing, disaster relief, transportation, etc. There are many different ways in which they are doled out with requirements for eligibility ranging from very specific to very general to none at all.

Typically there is an application process. For grants called “project” grants the applicants are competing against one another in terms of most worthy or most qualified to receive the money. This is based on the person or group's past performance. These types include educational scholarships, research grants, and community development grants.

There are also federal grants that are based on need. Low income families are provided for in large part by grants that will go for employment training, transportation, food/nutrition, healthcare, and the like. These grants are often based on a list of requirements that are on a scale and determine how much a particular person, based on need, will receive in subsidy.

Federal grants are also given with the more direct idea of jump starting local economies and companies that will in return provide increased revenues for the government. These include small business grants, urban development grants (which try to lure money back into the downtowns of large cities again), real estate improvement, technology and other product development, and the like.

The thing to keep in mind is that this is money that as long as you are using it within the specific guidelines set forth is money that can make large profits for you and never has to be paid off. There are billions of dollars given away each year to people like you that get rich. Donald Trump is an excellent example of a guy that made his fortune using federal grants to get his start.