Another local scholarship question

Paying for College
1

<p>Greetings,
I have searched on this topic and want to make sure I am understanding some of the information posted. My D. received (offered-not finalized) :</p>

<ul>
<li>a large merit scholarship (4 yrs.) $20,000 per year</li>
<li>2,500 Need based grant</li>
<li>subsidized and unsubsidized loans totaling about 5,500.</li>
</ul>

<p>This leaves a sizable amount for us to pay, obviously with COA approx.=51,000</p>

<p>She received word that she has received a local scholarship for 4,500 for each year in college. This is unrestricted and paid directly to college. Will not be paid until student is registered, and paid out every year. </p>

<p>The college policy is vague on the website. I did call, and awards under $500 don't impact aid., but greater ones might. Here are my questions: </p>

<p>1.Does this award fall under D's income?
(She currently is not working/can't find summer job. We did put in an amount anticipating a summer job contribution.) </p>

<ol>
<li><p>If unrestricted, can we state we want to use it for room/board, and will that matter? How about books? </p></li>
<li><p>I realized we report this scholarship in future years differently (because we can anticipate it in advance), and we will go from there. It gets recorded as student income? </p></li>
<li><p>I have read that this would impact loans first, but is that for students who have everything covered in grants and loans? We aren't even close to that. </p></li>
</ol>

<p>Obviously, I am being up front with the school but want to be strategic and well-informed, especially when it comes to reporting and timing. I would like it to not impact need or merit, with the need based obviously going to change perhaps, year to year, based on a number of factors. (Fluctuating income). </p>

<p>Thanks for any advice. This is all new to us. And it goes without saying that we are thrilled with these scholarships.</p>

2

<p>I would not impact merit, but outside scholarships generally impact need based aid. Every college has their own policy.</p>

3

<p>You should be able to email the school’s finaid department and get clear guidelines. Write so you have a record of their response (which you don’t if you call). You can still do this in the “theory mode” as in “if my daughter gets an award this summer, how does that work?” . If they respond “might affect” then zip right back and ask them to specifically lay out the guidelines. Keep after them. You get to play the “happy but concerned parent” – and it is their JOB to explain this stuff to you. </p>

<p>Be nice. Be persistent. Even better, ask the granting group if they gave this scholarship to a kid in recent history that is now attending your kid’s college. Nothing like knowing what the college did with that first kid! Good luck.</p>

4

<p>Each school has their own policy for outside scholarships, so they are the final word. In most cases, outside money cannot be used to reduce the family’s EFC. Generally, outside scholarships affect need based FA, but usually loans and WS are impacted before grants. Again, schools vary, so give yours a call or email to find out their policy, they should be able to tell you specifically what they do, ‘might’ is not a good enough answer. If it was me, I’d try again and try to get someone else, when they give you the answer, have them send it to you in writing.</p>

<p>All institutional and outside scholarships and grants come under your Ds taxes. However, the only part that is taxable is the amount above the cost of tuition and fees (R&B, books, travel and misc. expenses don’t count). So for tax purposes, one usually wants to apply scholarships and grants towards tuition rather than other costs.</p>

5

<p>The one thing you didn’t tell us is what your EFC is! Often if a school has not met your need (need = COA-EFC) they will not reduce their aid until need is met, or at least whatever average percent of need they try to meet is achieved. Very few schools will allow outside scholarships to be applied to EFC, as very few schools even meet 100% of need. Most will allow the student/family to reduce “self-help” awards like work study, loans with outside scholarships if there is no gap.</p>