What is Merit-Based Aid (and How You Can Get it)

Carol Katarsky Updated on December 1, 2020

Typically, when people think of financial aid, they think of need-based grants and federal loans that are subsidized or have other favorable terms, largely given to students with demonstrated financial need. But there are plenty of aid options for families with higher incomes.

Merit need, as you may guess from the name, consists of grants and scholarships doled out based on the student’s achievements. That doesn’t necessarily mean you have to be at the top of your class to qualify for it, either. Merit aid is often designated for students with compelling achievements in the arts, athletics, community work, or other areas.

What it is

When you’re in the middle of applying to schools and trying to make yourself as impressive as possible, it’s easy to lose sight of the fact that schools also are selling themselves to students. They want to enroll the best possible students they can. They may also have specific needs they to fill, such as a finding a person who plays a specific instrument for the school orchestra or recruiting high-quality students to bolster a new degree program. Merit aid is an important tool colleges and universities use to recruit those students.

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How to apply

It’s important to know that merit aid is common, but not all schools offer it, and some can afford to give much larger grants than others. Of schools that do offer merit aid, the criteria and application process can vary a lot. And unlike some forms of financial aid, merit aid may or may not be renewable.

If you want to pursue merit aid (and there’s no reason not to) you’ll want to research the options and process at each of the schools you’re applying to.

Some schools automatically consider you for financial aid once you submit your college application and FAFSA. Others have entirely separate applications. In some cases, you may have to fill out yet another application for specific grants.

Whatever the process is at your target schools, make sure you add those deadlines and requirements to your college application to-do list so you don’t miss out on any opportunities.

Maximize your odds

The good thing about merit aid is you can earn it based on your achievements. The bad thing is… so can every other student you’re competing with. Fortunately, there are things you can do to improve your chances – without having to earn a spot on the Olympics team or sell a painting for six figures before you graduate high school. Here are four tips for maximizing your chances of snagging a great merit aid package.

Target the right schools. Your best chance of getting a merit award is to apply to selective schools, but not the absolutely most selective ones you can get into, such as the Ivies. The very top schools don’t dole out as much merit aid —because they don’t need it to attract students. Schools that are competitive but not quite in the elite level are more likely to offer merit aid. What does that mean for you? Schools where your academic profile (GPA, SAT scores, etc.) places you in roughly the top 25% of applicants are going to be your sweet spot.

Think private. In general, private schools have larger endowments. Those resources allow them to offer more merit aid to more of the students they most want.

Think local. There’s a key exception to the private school rule above. Your home state university system may be a good source of aid. While they may have smaller total awards, their merit aid, combined with lower tuition costs can add up to an overall lower cost than a more generous merit aid package from a pricier, private school. There’s no formula for this one, unfortunately. You just have to apply and weigh the offers if and when they come in.

Do your homework. More colleges and universities are publishing information and tools to help you estimate how much merit aid you’d be likely qualify for at that institution. It’s worth taking some time to research. If you’re debating applying to two schools and one shows it’s likely to offer you an extra $10k in merit aid, that’s an important factor to consider.

Other resources for merit-based grants

Besides your school, there are some other options for finding merit aid. Many states offer merit-based scholarships and grants for high-performing students. In most cases, you must attend a school in the state to qualify for it. There are also many private organizations that offer a variety of merit-based grants. The criteria for these grants can vary widely, so plan on spending some time looking for the ones that best suit you.

You can find other sources of merit aid as well as general scholarships and grants you may qualify for by searching through our scholarship database.

About the Author
Carol Katarsky

Carol Katarsky is a contributing writer for Nitro. She is an award-winning journalist with extensive experience writing about both finance and education. Her corporate and non-profit clients include AIG, Children's Hospital of Philadelphia, and the Project Management Institute. She lives in Philadelphia with her husband, son, and one cat more than she should. Read more by Carol Katarsky

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