The complete guide to college scholarships and grants

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When you need to pay for higher education, it’s best to explore your cheapest options first. College grants and scholarships don’t need to be repaid, which shrinks the overall cost of your degree. And there’s plenty of free money to go around. During the 2018-19 school year, the typical family received $8,177 through grants and scholarships, according to Sallie Mae’s 2019 “How America Pays for College” report. If you’re looking for ways to save money on school costs, start with this guide to college grants and college scholarships.

What is a college grant?

A college grant is considered “gift aid,” which is free money that doesn’t need to be repaid. Grants are usually awarded to students with financial need. According to College Board, during the 2018-19 school year, undergraduates and graduates received $135.6 billion overall in grant money. Students can use these funds to pay for school expenses, such as tuition, fees, transportation and room and board.

How grants work

Most students looking for college grants start with federal and state programs, but grants are also available through some private organizations and nonprofits.

Here’s what to expect when applying for a college grant from a federal or state government:

  1. Fill out the FAFSA. To unlock state and federal grants, head to the Department of Education’s website and fill out the Free Application for Federal Student Aid (FAFSA) form. It’s free and comes out at the beginning of October each year. Some states also require you to fill out a separate grant application in addition to the FAFSA.
  2. Review your results. You’ll receive financial aid award letters from colleges that have accepted you. These letters explain whether you’re eligible for grants and other types of aid, such as scholarships, work-study programs and federal student loans.
  3. Accept the aid. It’s a good idea to first accept grants and scholarships you qualify for, because they don’t have to be repaid. Your financial aid offer may also include student loans, but consider how you’ll repay the money before going this route.
  4. The grant money is disbursed. The Department of Education sends the money straight to your school, which then applies the funds to your tuition, fees and other eligible expenses. Your school sends any remaining money to you.
  5. Reapply as needed. Federal grants aren’t guaranteed for all school years, so you’ll need to submit a new FAFSA form each year. You might not qualify if your financial situation changes dramatically from one year to the next.
  6. Check ongoing requirements. In some cases, students will need to repay a grant if they no longer meet eligibility requirements. For example, withdrawing from school early, switching to part-time enrollment or receiving other types of financial aid may hurt your eligibility for a grant.

The process to apply for a private college grant is similar. You typically must fill out an application and submit documents that demonstrate financial need. Once you qualify, the organization may send the funds directly to your school, with any leftover money sent your way. Check any ongoing requirements to make sure that you remain eligible for the grant.

What is a college scholarship?

A college scholarship is financial aid that doesn’t need to be repaid. These can help you pay for school expenses, such as tuition, fees and room and board, and they may cover the entire cost of your degree or just a portion of it.

During the 2015-16 school year, more than 1.58 million scholarships helped undergraduate students pay for college. Many are awarded based on a student’s achievements, talents and interests. So no matter where your skills lie — for example, in the classroom, on the football field or onstage — there’s likely a scholarship out there for you. Many are even geared toward unique interests and personality traits. Better yet, there’s no limit to the number of scholarships you can apply for.

How scholarships work

With so many scholarship options out there, it’s a good idea to set up a plan of attack. Here’s what you can expect during the scholarship search and application process:

  1. Register with a scholarship database. These services help match available scholarships to your skills and interests. A few popular databases include Fastweb, Cappex and Unigo.
  2. Apply for scholarships. As you move through the scholarship applications, make sure you understand the requirements and follow all instructions. For example, if the scholarship requires an essay, then write within the word count provided. Then plan to submit the application a few days before the deadline to give yourself a buffer.
  3. Accept the scholarship money. Once you win a scholarship, the scholarship provider sends instructions for accepting the funds. Make sure that the provider has the information it needs to disburse funds to you or your school.
  4. Check for extra steps or requirements. Some scholarship providers require students to do a little extra after winning the scholarship. For example, you may need to submit a bio and photo for the provider’s website, mentor future scholarship winners or maintain a certain GPA to renew the scholarship.
  5. Notify your school’s financial aid department. The total amount you receive in grants, scholarships and student loans typically can’t exceed the cost of your school attendance. So when you win a scholarship, your school may have to adjust your financial aid package. Ask your school’s financial aid office how your aid may change once you’ve won a scholarship.

What is the difference between a grant and scholarship?

While the terms “grant” and “scholarship” are often used interchangeably, they are different types of financial aid.

Neither type of award has to be repaid, but grants are usually awarded based on financial need. Scholarships are usually merit-based, though some private scholarships are based on both merit and financial need.

Types of grants and scholarships

During the 2018-19 school year, grants and scholarships covered 31 percent of education costs for students, according to the Sallie Mae report. Here are some places where you may find college grants and college scholarships.

Grants

The Department of Education offers four main types of federal student grants. These are designed to help low-income students pay for school expenses at colleges, career training schools and universities. Beyond federal aid, you may also find grants through state programs and private organizations.

  • Federal Pell Grants are awarded to every eligible undergraduate who shows exceptional financial need. Pell Grant awards are updated annually, and for the 2020-21 award year, each student may receive up to $6,345. The award amount depends on your family’s expected contribution, your school’s cost of attendance and other factors.
  • Federal Supplemental Education Opportunity Grants (FSEOG) help undergraduate students with exceptional financial need pay for higher education. You can receive up to $4,000 a year, depending on whether your school participates in the program, available funds, your level of financial need and other factors.
  • Teacher Education Assistance for College and Higher Education (TEACH) Grants provide federal grants to students pursuing degrees in education. You may receive up to $4,000 a year as long as you agree to later teach in a school that serves students from low-income families. But if you don’t meet this obligation, the grant turns into a Direct Unsubsidized Loan that you must repay.
  • Iraq and Afghanistan Service Grants are available if your parent or guardian died as a result of serving in Iraq or Afghanistan after Sept. 11, 2001; you were younger than 24 or enrolled in college at least part-time when they died; and you can demonstrate financial need. If you qualify, you can receive up to $6,345 for the 2020-21 school year.
  • State-based grant: Nearly every state hosts a financial aid program to help students pay for college. To qualify, most states require you to be a resident, fill out the FAFSA and attend an in-state school. Some states even have regional tuition exchanges, which allow you to pay in-state tuition at a school in a nearby state.
  • Private grants: You can search for private college grants using the U.S. Department of Labor’s free scholarship and grant search tool.

Scholarships

Most scholarships are merit-based and may fall under these broad categories:

  • Academic achievement: Academic scholarships are based on earning superior grades in the classroom, a high GPA and/or excellent standardized test scores.
  • Sports: Many colleges offer athletic scholarships to standout student-athletes who agree to play on the school’s team.
  • Arts: Creative students can search for scholarships geared toward music, visual arts, theater and more.
  • School-based scholarships: Most colleges and universities provide their own scholarships as part of their ongoing financial aid programs. Ask your school’s financial aid office about your options.
  • Family background: Some scholarships are awarded based on a student’s traits or background. For example, you can find scholarships designed for first-generation college students, people in the LGBTQ community and underrepresented minority groups.
  • Career, major or industry: You may find scholarships designed for your expected field of study or career plans.

Tips for preparing for a scholarship or grant

As you prepare to apply for college grants and scholarships, keep these tips in mind:

  • Get organized. Keep a list of grants and scholarships you’re researching, along with ones you’ve applied to, and include the major requirements and deadlines. Then set up a folder to keep your essays, details and documents in one place. Having these ready can help streamline the process.
  • Focus on your unique traits. You may stand a better chance at winning local scholarships or ones with specific eligibility requirements. Your school counselors, teachers and parents may also know of scholarships that are a good fit for you.
  • Be careful. Make sure the offers you receive are legitimate. You also shouldn’t have to pay for scholarships or for scholarship searches. And you definitely don’t need to pay for the FAFSA — it’s a free form.
  • Follow all instructions. Don’t risk disqualification because you didn’t read the directions or submit the application on time. Use the instructions as a checklist and check off each item to make sure that you’ve met requirements.
  • Apply as early as possible. While many students search for grants and scholarships during their senior year, you can usually start applying much earlier. And when it’s time to fill out the FAFSA during senior year, apply as early as possible. Some aid is awarded on a first-come, first served basis.
  • Continue applying for aid. About half of available scholarships are for students already enrolled in college, so keep up your search while in school.
  • Check ongoing requirements. To remain eligible for the scholarship, you may need to maintain a certain GPA or renew your application each school year.

Frequently asked questions about college scholarships and grants

What college grants do I qualify for?

Fill out and submit the FAFSA each school year to find out whether you qualify for state and federal college grants. Grants from private organizations and nonprofits have different requirements, so check each program for guidelines.

How many grants can you get for college?

The number of federal grants you may receive depends on the information in your FAFSA. There’s no limit to the number of private grants you can apply for, but any grants you win may impact your financial aid package.

What income qualifies for financial aid?

There’s no income cutoff for federal college grants. The amount you receive is based on your family’s expected contributions, not income. Every scholarship has its own income requirements, so check each program for details.

When should I start looking for college scholarships?

You can start searching for college scholarships at any time. Some scholarships have no age limits, while others allow you to apply early in your high school career or while you’re already enrolled in college.

Do all scholarships require an essay?

Many college scholarships require an essay, but not all do. Check the scholarship’s requirements to find out. If you’re having trouble writing, ask a friend, counselor or teacher for help. They may inspire an idea, offer to edit your work or suggest another resource.

Do I need a letter of recommendation?

Many scholarships ask for at least one letter of recommendation, which helps the admissions office get to know you outside of your academic resume. Requirements may vary, but you may be able to get a recommendation letter from a teacher, counselor, employer or coach.

Featured image by Nattakit.K of Shutterstock.

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