During the 2014-15 academic year, college and grad students received $123.8 billion in scholarships and grants, reports the College Board. People sometimes use the terms “grant” and “scholarship” interchangeably, but these words refer to different kinds of financial aid. There are two big differences when it comes to scholarships vs. grants: where the money comes from and who can receive it.
Do grants and scholarships have to be paid back?
No. Grants and scholarships are called “gift aid,” because you don’t need to repay them as you would a loan. They’re basically free money, but there are some strings attached. If you don’t use a grant or scholarship as it is intended or fail to meet its requirements, you risk losing this aid. Certain government grants even require individuals to pay back the money if they fail to meet the grant’s requirements. Before applying for any type of financial aid, carefully review the guidelines.
What is a scholarship?
Scholarships are usually awarded to students with certain qualities. Common scholarship types are:
- Merit-based – Awarded to students based on academic achievement.
- Student-specific – Given to students from a specific community or group, such as Native Americans, women, the LGBT community, continuing-education students or international students.
- Career-specific – For students who pursue a particular course of study, often in high-demand professions such as education or nursing.
- Athletic – For students who participate in a college or university’s athletic program.
- Need-based – Easily confused with grants, these scholarships are commonly available from individual schools to students who meet certain criteria.
There are other types of scholarships. Some corporations offer “branded scholarships,” which are available either through an application process or by winning a competition. Businesses and labor unions sometimes offer scholarships to their employees or members or to their kids. Your religious community or civic group may do this too.
Keep in mind, continuing to receive your scholarship may require maintaining a certain GPA, staying involved in the school’s athletic program or meeting other requirements.
What is a grant?
- Federal Pell Grants
- Federal Supplemental Education Opportunity Grants (FSEOG)
- Teacher Education Assistance for College and Higher Education (TEACH) Grants
- Iraq and Afghanistan Service Grants
Eligibility requirements vary. The TEACH Grant is for students who plan to pursue a career in education, while the Iraq and Afghanistan Service Grant is for the children of military members who lost their lives in the Iraq or Afghanistan wars. These grants are mainly for undergrads.
As always, do your homework.
As you pursue opportunities for financial aid, make a mental list of qualities that make you a unique student, whether it’s your academic achievements, economic status, athletic ability, age, ethnicity or anything else. Chances are, there is a grant or scholarship tailored to your background, needs or ambitions.
Research each scholarship or grant carefully, noting eligibility rules, guidelines for recipients and details about the application process such as documents and deadlines.
True, it’s a lot to keep in mind. But you can boost your chances of receiving great financial aid by avoiding these seven big mistakes during your grant and scholarship application process.