Going to college is expensive. According to the College Board, the total cost of attending public four-year universities for resident students in 2022-23 was $27,940, while non-resident students paid an average of $45,250. Students at private nonprofit four-year universities spent even more: nearly $57,600.
If you want to lower your college expenses, scholarships and grants should be your first option. Unlike government and private student loans, both are a form of gifting, meaning you don’t have to pay them back. Here’s what you should know.
Scholarships and grants are a type of grant (money that does not have to be repaid). They are the second largest source of financial aid, covering over 25 percent of students’ college expenses.
- Scholarships, combined with fellowships, were the second-largest source of funding in 2021-22, covering an average of 26 percent of students’ college costs.
- The average grant award in 2022 was $6,041 — a 22 percent decrease from the previous year.
- During the 2021-22 academic year, 60 percent of American families used scholarships to fund college.
- Of the households that did not claim college-funding scholarships in 2021-22, about a third applied.
- Among those who accepted scholarships in 2022, 62 percent said they received them from their college or university.
- The average institutional grant price is $6,335.
About four in ten grantees received funding from their state, with an average grant of more than $2,362.
37 percent of grantees received money from private sources, including corporations and nonprofit organizations; the average amount was $2,189.
- The average white student received $4,250 in scholarships for the 2021-22 academic year, while black students received an average of $2,303. Hispanic students received the lowest grant amount, averaging $2,259.
- In 2021-22, students received a total of $140.6 billion in grants.
Fifty-five percent of American families reported using grants to pay for their children’s college costs in the 2021-22 school year.
- Undergraduate students received an average of $10,590 in scholarships in the 2021-22 academic year — twice what they received 20 years ago.
- Graduate students received an average of $9,120 in grants, a 37 percent increase over the past two decades.
- Scholarships for both undergraduate and graduate students have increased by 7 percent over the past decade.
- Of all types of grants, those provided by institutions have grown the most over the past decade. They totaled $74.4 billion in the 2021-22 academic year, an increase of 48 percent since 2011-12.
More than half of all scholarships awarded in 2021-22 came from the student institutions.
- Federal grants were the second largest source of funding, accounting for 26 percent of all grants in 2021-22.
- Government grants were the smallest source of funding, accounting for just 9 percent of all grants in 2021-22.
- In the 2021-22 academic year, 6.2 million college students were recipients of Pell Grants.
Scholarships and Grants by Recipient
For scholarships and grants, aid is distributed almost evenly among students from diverse backgrounds, as shown in the chart below. The most notable difference is between black and Asian students. According to the latest figures from the National Center for Education Statistics, 88 percent of black students received some form of gift aid in 2015-16, while only 66 percent of Asian students received some form of gift aid.
Likewise, there was not much difference between the percentage of men and women receiving scholarships and grants in 2015-16. Approximately 73 percent of full-time male students received gift assistance, while nearly 80 percent of female students received gift assistance.
Source: National Center for Education Statistics
Grants and grants by household income and type of institution
Although private nonprofit four-year institutions are more expensive than attending a four-year public institution, they also offer more grants to students.
Data from the National Center for Education Statistics shows that the average cost of attending a public four-year institution was $20,385 in 2020-21, while the average cost of attending a private nonprofit four-year institution was $43,758.
Between scholarships and grants, students in public institutions received an average of $7,813, regardless of their income. Meanwhile, students at private institutions received an average of $21,011 in grant grants. Scholarships and grants thus accounted for about 38 percent of the costs for public institutions and almost half for private institutions.
That being said, students with household incomes of $48,000 or less at both public and private universities tend to receive significantly more gifting aid, as shown below.
|$0 to $30,000||$11,386||$26,753|
|$30,001 to $48,000||$10,445||$27,003|
|$48,001 to $75,000||$7,561||$25,012|
|$75,001 to $110,000||$4,392||$22,080|
|$110,001 and up||$2,777||$18,389|
How to Apply for Scholarships
Scholarships fit into two main categories: need-based and merit-based. Need-Based Scholarships are awarded based on your financial need to pay for college. Merit-based scholarships are awarded on the basis of recipients excelling in something, e.g. B. Academics, Athletics or Arts.
You can also get scholarships if you meet certain criteria such as: For example, studying a specific degree, being a first-generation student, or a member of the LGBTQ+ community. Likewise, there are scholarships for women, Latino students, and many other groups.
Universities, the state and non-profit organizations usually award needs-based scholarships. The application includes filling out the FAFSA. Your school may also require the CSS profile.
Both forms will help your school and other organizations decide whether or not to receive additional funding based on your financial circumstances and needs.
However, merit-based scholarships require you to search more as private institutions and companies often offer them. You can find hundreds of them using scholarship search engines like Scholarships.com and Fastweb. Although requirements may vary, they typically include:
- A written statement.
- A copy of your CV.
- Two references.
- A letter of recommendation from one or more sources.
- A copy of your transcripts (especially if a specific GPA is required).
Although this can be time consuming, it is worth it. You could secure thousands of dollars worth of help just by filling out a form and tracking deadlines.
How to apply for grants
Applying for scholarships is usually quite easy. Most of these are needs-based, which means they are awarded based on your economic need and can be obtained from the federal, state and local governments as well as from your university.
The most prominent and generous scholarship available is the Pell Scholarship, which is currently endowed with a maximum of $6,895 for the 2022-23 academic year. Generally, to apply for scholarships, you only need to fill out the FAFSA and CSS profiles. Not all schools use the CSS profile, so check it first.
Both forms ask questions about your family size, living situation, and household income to determine your eligibility.
What to do if your financial aid package is not enough?
With skyrocketing inflation making everything more expensive and tuition fees rising, scholarships and grants may not cover your expenses. Federal student loans may not be enough to make up the difference.
If your financial aid package is not sufficient, you can use private student loans to bridge the gap. However, unlike federal student loans, private student loans are granted on a credit basis. It’s important to research lenders and compare offers before signing on the dotted line to ensure you’re getting the best terms and interest rates available for your situation.
If bad credit is preventing you from accessing the best interest rates, don’t be stuck with a high interest rate forever. You can refinance your private student loan at any time as soon as your financial situation and credit rating have improved. Refinancing can make your debt more manageable and save you money on interest.