Everyone loves the idea of a scholarship. Who doesn’t want free money for college?
However, there’s a huge amount of misinformation out there about scholarships, and it’s easy to get caught up in the hype.
Many students and families get their hopes up when they hear about other students getting a scholarship or when they hear a so-called expert tell them that scholarships are a massive opportunity for free money. But then their hopes are dashed.
On the other hand, some families don’t even bother to think about scholarships because they assume they won’t qualify. Their student isn’t an academic superstar or an athlete, so they assume there’s no way they’ll get a scholarship.
But scholarships aren’t that simple, so you shouldn’t get your hopes too high or assume that a scholarship is impossible. The reality is that a “scholarship” means different things in different situations, and it’s important to know about the different types of scholarships, what it takes to qualify, and whether they’re worth it before you make any assumptions or draw any conclusions.
Many students and families don’t understand the different types of scholarships and how they work, so they end up missing out on free money. Others get caught up in the hype about scholarships and are disappointed when they don’t get one and find out that all their work to apply for them was a waste of time.
In this article, we’ll dispel the misconceptions by taking a look at the three most common types of scholarships. We’ll examine what they are, how they work, and what’s involved in qualifying and applying for them.
You can use this knowledge to think more critically about scholarships and make more informed and realistic assessments about whether to pursue them. Who knows? You might get some free money after all, or maybe you’ll save yourself a lot of wasted time and effort.
Let’s get started.
1. Merit Scholarships (Just for Applying for Admission)
Some merit scholarships are available from colleges just for applying for admission. To receive them at many private colleges and some public universities, all you need to do is submit an application and be accepted for admission.
At many schools, just being accepted is enough to warrant a merit scholarship. If you also have other strong academic qualifications, your merit scholarship award may be larger.
This is why it’s a good idea to include these kinds of scholarships in your college planning and your research into different schools. For families looking to minimize college costs, you may want to find colleges where you’ll be a good candidate for merit scholarships.
2. Need-Based Scholarships (Just for Completing Your Financial Aid Forms)
Additional scholarships from colleges as well as grants from the federal government are available based on your financial situation. To pursue these need-based scholarships and grants, you’ll need to fill out and submit the FAFSA form or other applications for financial aid.
Your financial need will be calculated based on these financial aid forms, and colleges may award you scholarships and federal grants based on your qualifications.
You can get a sense of whether you’ll qualify for need-based aid by using my Student Aid Index (SAI) Calculator. It uses the actual federal financial aid formulas to estimate your financial need.
As a reminder, when you submit your FAFSA form, you may qualify for federal grants and not just scholarships. To learn more about federal grants, read my article on the 5 Types of Federal Financial Aid.
3. Scholarships with Unique Requirements (That Require Doing Something More)
There are many other scholarships available from colleges and other sources, but you’ll need to spend some time and do some research to find them. These scholarships also have unique requirements, and they’ll typically require you to do three things:
- Do something
- Meet specific qualifications
- Win
Within these three areas, there are different things you might need to do. Here are some quick examples:
Do Something
- Find the scholarship
- Submit a scholarship application
- Write an essay
- Get letters of recommendation
- Sit for an interview
- Participate in a contest
- Participate in an audition
- Submit an online form
Meet Specific Qualifications
- Have unique skills, traits, or characteristics
- Demonstrate a special talent or hobby
- Be an athlete
- Belong to a club
- Be part of a particular race or ethnic group
- Have a particular personal history or medical status
Win
- Be the best among the best of qualified applicants
- Win a contest
- Pass an audition
You may need to do one or more of these things, including one or more in each area, to win a scholarship. That means these scholarships often require significant effort.
For example, to win a particular scholarship, you might need to submit an application along with a written essay and three letters of recommendation, and then you may need to travel to the school for an in-person interview. Or you may need to submit a recorded song composition or travel to a college and perform at an audition. Even then, there’s still no guarantee you’ll succeed and get the scholarship.
Here’s why that matters and why you should care about it.
I always recommend that everybody pursue merit scholarships where you may qualify based on merit and just for applying. And I also recommend that everyone pursue a need-based scholarship, where you might qualify based on financial need. But the third type of scholarship, where unique requirements are involved, is one that many people don’t consider, or they simply don’t want to do the work.
As an example, someone might say, “Hey, I got a $10,000 scholarship.” But you don’t hear that they received it by simply applying to a particular college, and it was only available there. Or you don’t hear that they received it by applying for financial aid.
That’s much different than winning a $10,000 scholarship from a company for your academic achievement, but you had to write an essay, sit down for personal interviews, and meet stringent GPA requirements. And this is where it’s important to separate the hype from reality.
Some students make headlines or attract attention by sharing a video or blog about how they got over $100,000 in scholarships. But they don’t tell you that this is the total amount in merit scholarships they were offered from multiple schools just for applying, and they can only accept one scholarship and use it at one school. In reality, they might only be getting $10,000 instead of $100,000 to help pay for their college costs.
Similarly, so-called scholarship “experts” might advertise books and products promising to show you how you can take advantage of millions of dollars in scholarships. But they don’t tell you that many students will get some of these scholarships automatically, without knowing or doing anything special. They are available just for applying to a college or submitting a FAFSA form for financial aid.
Then there are other people who talk about how they had to work hard to get a bunch of scholarships. When they say that, now we’re talking about doing the real work to find additional scholarships and the right ones for your student.
Whether or not you want to do that work and pursue those scholarships is always a key question to ask.
One free and easy way to get started is my Scholarship Guide for Busy Parents. It’s a quick video course where I’ll show you everything you need to know about scholarships in four videos that you can watch at your convenience. It’s 100% free, and when you sign up, you’ll also get my free college planning newsletter loaded with tips and advice to help you plan and save for college.
To get started, visit my course page now. And if you need additional college planning advice, check out my other resources below.
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You can also check some of my other helpful blog articles and resources below.
Helpful Articles and Resources
The 5 Key Components to a College Financial Plan
Learn the 5 key parts of a good college financial plan and how to get started.
The 5 Types of Federal Financial Aid
Find out if the 5 types of federal aid are available to your family and what they mean for you.
6 Ways to Pay for College
Find out the 6 ways to pay for college and the crucial things to keep in mind for each one.
20 Core Areas of College Planning
Learn the 20 things virtually everybody should work on when planning and saving for college.
10 Things to Consider Before Choosing a College
Don’t make one of the biggest decisions of your life without reading this article.
