Scholarships vs. Grants: Understanding the Differences in Financial Aid
When it comes to financing higher education, grants and scholarships stand out as invaluable resources. They both offer financial assistance that doesn't require repayment, effectively providing "free money" for education. While often grouped together, understanding the distinctions between grants and scholarships is crucial for students seeking financial aid.
What are Grants?
A grant is a form of financial aid typically awarded to students with financial need to help cover college expenses. The most well-known type is the federal Pell Grant, but grants are also offered by state governments, colleges, and universities.
Eligibility for Grants
Grants are nearly always based on financial need. Students must demonstrate their financial need through the Free Application for Federal Student Aid (FAFSA). The federal government allocates a certain amount of funds to be awarded as grants during each academic year. The funds are disbursed on a first-come, first-served basis until the funds run out. The earlier you apply for a grant, the higher your chances of receiving the full amount you’re entitled to.
Sources of Funding for Grants
Grants typically come from the government, either federal or state, or from the school itself.
Application Process for Grants
Grants are often awarded automatically if you qualify through the FAFSA. Completing the FAFSA is a mandatory requirement to qualify for grants.
Read also: Camp Scholarships Guide
What are Scholarships?
Scholarships are financial aid awarded for various reasons, not solely based on financial need. Scholarships come from diverse sources, including local businesses, non-profit organizations, and colleges.
Eligibility for Scholarships
Scholarships are generally awarded based on academic or extra-curricular merit. They require an application outlining why an applicant feels he or she is deserving of the award. While some scholarships are highly competitive, others may have fewer applicants than you’d expect. Most scholarships are based on merit but they are not limited to this one criterion. Some scholarships are merit-based, either based on your high school grades, athletic ability, or a demonstrated skill. Most scholarships require applicants to meet more than one requirement. The more eligibility requirements a scholarship has, the fewer eligible applicants there will be, giving you a greater chance of being selected as a winner. Always check eligibility criteria before taking the time to apply.
Sources of Funding for Scholarships
Scholarships are awarded by a number of funding sources. These can include businesses, religious groups, individuals, community organizations, college departments, or alumni. Providers like Bold.org make it easy for any individual, organization, company, or family to fund a scholarship and make their vision come to life.
Application Process for Scholarships
Scholarships usually go to undergraduate students. Once the graduate level is reached, private financial aid comes in the form of what is known as fellowships. These fund advanced studies and research. Scholarships require an application outlining why an applicant feels he or she is deserving of the award. Most scholarships require an essay submission as part of the application but there are also more creative options that allow images, videos, or artistic portfolios to be submitted instead of an essay. Some scholarships are even easier to apply for, requiring just a few clicks to apply! You can find no-essay scholarships by selecting "no-essay" when browsing on Bold.org.
Key Differences Between Grants and Scholarships
| Feature | Grants | Scholarships |
|---|---|---|
| Basis | Financial need | Merit, talent, or other criteria |
| Funding Sources | Government (federal or state), schools | Businesses, organizations, colleges, etc. |
| Application | Often automatic via FAFSA | Requires application |
| Repayment | Not required | Not required |
Similarities Between Grants and Scholarships
Despite their differences, grants and scholarships share some key similarities:
Read also: Benefits of NSHSS Scholarships
- No Repayment: Both grants and scholarships do not need to be repaid, unlike college loans.
- Assistance with College Expenses: Both grants and scholarships help to pay for the necessities associated with higher education such as tuition, room, board, and textbooks.
- Requirements for Continued Funding: Both grants and scholarships usually have some sort of requirements in order to continue to receive funding, such as maintaining a certain GPA.
- Limited to One Academic Year: Another similarity between scholarships and grants is that the funds you receive are only for one academic year. Most are not recurring awards which means you have to apply every year you’re in college to continue receiving aid every year. An exception to this may be a few scholarships, which are recurring.
How to Find Grants and Scholarships
Finding Grants
You can find grants by considering your federal options or by searching "grant" on Bold.org. Federally-funded grant recipients must fill out the FAFSA, Free Application for Federal Student Aid, in order to determine eligibility.
Finding Scholarships
Outside of your school, you can find plenty of other scholarships offered in your community. Businesses or organizations in your town may have open scholarships and your place of employment may also offer scholarships or guaranteed funding for your education. You can find large numbers of scholarship opportunities on sites like Bold.org. Creating an account and applying on Bold.org is completely free and gives you access to hundreds of exclusive scholarships for students at all levels of education and in all fields of study.
Maximizing Your Chances of Receiving Aid
- Complete the FAFSA: To qualify for need-based grants, filling out the FAFSA is essential.
- Apply for Scholarships: Pursue scholarships to earn even more free money based on your talents, passions, and background.
- Start Early: The earlier you apply for a grant, the higher your chances of receiving the full amount you’re entitled to.
- Consider Community Scholarships: Community scholarships are good options, but they can be difficult to discover.
- Check Eligibility Criteria: Always check eligibility criteria before taking the time to apply. The more eligibility requirements a scholarship has, the fewer eligible applicants there will be, giving you a greater chance of being selected as a winner.
- Apply for a Variety of Scholarships: No matter your time constraints, education level, career path, or demographic, there are scholarships out there to help you.
Financial Aid and its Impact
Scholarships and grants provide roughly $50 billion in aid every year, with $46 billion coming from the federal government and $3.3 billion coming from private sources. These funds help thousands of students reduce or eliminate their need for private student loans or federal loans. Despite this aid, the student loan crisis has continued to grow in recent years, rising by 144% since 2007. Around 45 million Americans are currently paying off student debt, owing a total of more than $1.7 trillion. Luckily, more donors are turning to scholarships every year, leading to new opportunities for financial aid every day.
Grants and Scholarships on Bold.org
If you win a scholarship on Bold.org, the money will be sent to your school's financial aid office to go towards your education expenses. Grants won on Bold.org will typically be sent directly to your school unless otherwise specified. If you've won a grant for graduates with loans, such as the Forget Your Student Debt. Before receiving the funds, you'll sign a grant agreement outlining eligible uses of the money. Once you receive the award, you'll have up to a year to use the money.
Read also: Scholarship Guide
tags: #scholarships #vs #grants
