It’s March! Which means one thing…financial aid awards will soon be going out from Colleges and Universities across the country (oh, and I guess spring break is coming up too). Receiving a financial aid award is often confusing to students and parents alike. There are so many different forms financial aid can take and it can be hard to understand what is offered. So, I thought breaking down the basics of a typical financial aid award might be good.
A typical financial aid award may include four types of financial aid, scholarships, grants, loans, and work study. Each of these types can come in a few different forms. It is important to understand each of them as you accept the award.
Scholarships: Scholarships are funds given to a student that do not have to be repaid. There are a few different types of scholarships for which a student can qualify. They can be need based, which means they are dependent on income and financial need, usually determined by the FAFSA. They can also be academic in nature, this means they are based on test scores and school performance. There are also athletic scholarships, scholarships for minorities, community service scholarships, and unusual or random scholarships (there’s even one for being a natural redhead). If the scholarship is awarded on behalf of your college or university, it is usually reported as part of your financial aid package, if it is an outside scholarship, you should contact your institution’s financial aid office to be sure you understand the reporting requirements. If you haven’t received any scholarships or want more, it’s never too late to apply! A few good resources are:
Remember, you shouldn’t pay to apply for scholarships, there are a few exceptions, but be vigilant!
Grants: This is money that a student receives based on financial need that does not have to be paid back. There are two main grants, both awarded through the FAFSA, Pell Grants and Supplemental Educational Opportunity Grants (SEOG). In order to qualify for grants a student must fill out the Free Application for Federal Student Aid (FAFSA https://studentaid.ed.gov/sa/). The FAFSA opens on October 1st each year and the priority deadlines for submission vary by institution.
Loans: There are three types of federal loans that a student can be awarded based on their FAFSA.
Direct Subsidized Loans: A subsidized loan is a loan that the student is a