Properly formatting your grant is essential for ensuring its comprehensibility to reviewers, which facilitates their ability to understand and promote your work. It can also help ensure that your documents are fully compliant with sponsor guidelines.

Labeling sections and subsections

All grants have required sections and subsections. These need to be clearly enumerated and labeled within your proposal. For example, a standard NIH grant has sections labeled 1,2,3 for significance, innovation, and approach. Set up your document with these specific phrases and numerical denotations. Next, look at the funding announcement and search for any required subsections. Examples include statistical analysis, animals, and rigor of the prior literature. Place these required subsections with headings and bold them. Look both at the instructions and the instructions to reviewers to make sure you identify all relevant sections. 

Once you've got to everything required labeled, you should add additional labels to help orient your reviewer. Examples include adding rationale, hypothesis, approach, anticipated outcomes, and pitfalls and alternative strategies to each aim. Keep these labels consistent to help your reader move through your proposal. 

Adding specific numberings to your subsections can be helpful too. It allows you to easily refer a reviewer to a specific section from another section- for example, you can include text like "see rigor, strategy section 1.2". This level of organization makes it easier for your review to follow your grant and makes it look like you are an organized person who has your act together, and are thus a good investment of federal funding.

Fonts, justification, and spacing

Carefully read the grant guidelines. Most will specify characteristics about fonts, spacing, and margins. Use Word's built in tools to set these parameters right at the outset. For NIH grants as of this writing, Arial 11 pt font, 0.5 in margins is the requirement. Don't get fancy.

In my opinion, fully justified text looks best. Fully justified text that is automatically hyphenated uses limited writing space most efficiently.

Your document needs to include white space. Your reviewer is likely reading your grant at the last second while tired. Make it look approachable. My recommendation is to set the spacing between paragraphs to be 6 pt, and to not indent paragraphs. This will give your grant the appearance of having a clearly organized structure without being too packed in, and not waste any space.

Figures, tables, and text boxes 

Your grant should have a lot of figures, tables and legends. See this post for information on what types of preliminary data to include. 

In all cases, make sure all figures and tables are clearly numbered and referred to in the correct order in the text. Each figure should have a clear legend and included appropriate alt text. Make sure all are large enough to be read, and pay attention to size and font requirements for legends when provided. If not provided, use a minimum of 8 pt font. Group the legend with the figure and wrap text around the figure.

Consistency and Abbreviations

Using the same term to describe to same thing consistently throughout your grant is also important for readability. For example, do not switch between snRNAseq, snRNA-seq, snRNA-Seq, snRNA sequencing etc. you can use Google to discover what the most commonly used version is. Once you settle on something, use the find & replace function to ensure everything is uniform throughout all your documents.

For abbreviations, you do not need to define very common abbreviations. Examples include PCR, DNA, and RNA.  Terms that are used less than three times in a section should not be abbreviated. If you mention one electron microscopy study, do not bother stating the abbreviation EM. For other things you wish to abbreviate, be sure to redefine the abbreviation in each section (narrative, summary, aims, etc) of the grant. Within the research strategy, redefine the abbreviation at the beginning of a new section. As an example, it's common to include an abbreviation in the significance section and then not mention it again until aim 2 or 3. Redefine the abbreviation whenever your reader hasn't seen it for a while 

Compliance

Paying attention to the above-mentioned suggestions will facilitate compliance review of your proposal. You should be easily able to scan all documents and verify that you have included all necessary information, and that the document is in its proper format. 

Conclusion

A frustrated reader will not help your grant shine. At all times, keep the concept of making your grant as easy for your reader to understand as possible. This concept influences everything, including how the text appears on the page, labels, and minor details like abbreviations.