Is there even a point to getting scholarships?

Paying for College
1

<p>Let's say a school costs $40,000 a year. The school says they will give me $15,000 in grants, $2500 in loans, and $2500 in work study. So I need to basically pay $20,000 a year with my family.</p>

<p>If I get $10,000 in scholarships a year, wouldn't they just lower the amounts of grants they give me to like $5,000... so I'm not really gaining anything. It would be good if they took the $10,000 off from the $20,000 EFC, so I'd only have to pay $10,000 a year. So my basic question is, if you have scholarships do schools like Upenn, Columbia, Harvard, etc. subtract the scholarship money from your EFC or from the grants given?</p>

<p>I'm not sure if my understnaidng of all this is correct, so if anyone wants to help clarify, that'd be great.</p>

2

<p>Monies are first aplied to self help aid (work study and loans) then the balance reduces the grant/scholarship aid given by the school.</p>

<p>Birch explained it well concerning Harvard which is pretty much the same at Dartmouth where my D attends.</p>

<p>*Local scholarship donors can be asked to award funds in future years instead of the freshman year. S attends Harvard on combo Outside Awards, Harvard scholarship, and family contributions. His Outside Awards (some local, some national) were more than first year "self help" amount ( which is $3500 or so). Local scholarship donors were happy to send the money in a later year (or years). In this way, S's self help amount was reduced for all 4 years, instead of the money being applied only to first year (and thus reducing self help and then Harvard awards).
"Extra" scholarship dollars never would have reduced family contribution in his case (b/c excess scholarship funds apply first to work study, then to Harvard awards, then to family contribution), so by asking scholarship donors to send money in future years, S gets more non-family dollars actually applied to overall 4 year education costs. *</p>

3

<p>The value of your scholarships can be summarized as follows:</p>

<p>$0 – $2500
Exempts you from work study
$2501 – $5000
Replaces loans
$5001 – $20,000
BENEFITS YOU IN ABSOLUTELY NO WAY WHATSOEVER
$20,001+
Actually reduces the amount of money you have to pay</p>

<p>Deferring money for another year only helps you if for some reason you are not going to receive as much of an aid award the next year, or if you would not otherwise meet the self-help ($5000 in your example) each year.</p>

<p>But if you've won $10,000/annually, your $40,000 scholarship is worth no more than $20,000 to you IF you are receiving financial aid from the school. </p>

<p>Yes, schools will reduce your grant instead of your EFC.</p>

<p>It <em>may</em> be possible to negotiate this with them, since it appears to be a pretty regressive, unfair policy. Merit-based scholarships only benefit wealthy families under this system, a condition that ought to make a fairly strong argument. Unfortunately, I don't know of many situations where this has been the case. Note also that <em>some</em> schools will count outside scholarship money at a percentage (maybe 50%) rate, which makes even less sense to me.</p>

<p>There are arguments to the effect that, "Well, demonstrated need is being met, so outside sources shouldn't enable you to go over your need amount", as if the determination of financial need were perfectly affordable for all families. In cases where the family still has an EFC to pay down, I believe they should be allowed to receive outside merit assistance independent of their financial situation. But I guess that's a debate on its own.</p>

<p>More on the specifics of the policy as it actually stands: In this example scenario, having $10,000 in scholarships/year and having, for example, $20,000 in scholarships/year are exactly equivalent. There is no incentive nor reward in that extra $10,000.</p>

<p>Compare a family with millions in assets who does not qualify for financial aid with one like the example case above that receives $20,000 in financial assistance. Say each receives $20,000 in outside merit scholarships. They pay EXACTLY the same amount of money for college. If both students received more than $20,000 each year, they would still pay the same amount of money, because the financial aid was completely wiped out by the student's merit. It is only if the financially needy student's merit (as measured by scholarships) is less than their "need" that they benefit from aid.</p>

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<p>ok, thanks that helped a ton</p>

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<p>Follow up question:</p>

<p>A school like Princeton gives financial aid 100% in the form of grants, no loans/work study. In that case, any scholarship money is useless below the amount of EFC, is that correct?</p>

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<p>Sybbie, the Profile (which must be filed every year) asks about outside scholarship. Don't most schools reduce a significant percentage of need-based grants they would have awarded based on the outside scholarship? That is, if you receive a $4K merit scholarship, the school would reduce their need-based grant by $1K - $2K, and apply the remainder to work-study and loans.</p>

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<p>skierdude1000: scholarship money is useless below the amount of the GRANTS, not the EFC. That is, only scholarship monies exceeding the amount you've been granted will begin to reduce your EFC.</p>

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<p>This policy effectively discouraged me from pursuing further scholarships, because unless they were more than $25,000, they wouldn't have helped me in any way.</p>

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<p>I believe Princeton does offer work study. They also have expected student summer savings, which may be replaced by outside scholarships. I'd have to check the fin aid package from Princeton before being sure, though.</p>

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<p>I think it is better for students to apply and try than not to try at all. In the end, they may be more than pleasantly surprised.</p>

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<p>It depends on the merit scholarship. Some schools offer merit as part of their need based financial aid. Outside scholarships first help to reduce/ eliminate the seelf-help aid (workstudy and loans) then then it reduces your school grant aid.</p>

<p>Some schools allow you to use your outside scholarships toward the student contribution of your EFC -but they are few. Your best bet would be to ask your individual school their policy on outside scholarship.</p>

<p>I agree with Overseas that you should always apply for aid as you may be pleasantly surprised. </p>

<p>I think maybe some of these threads are a bit skewed because the many of the people posting either attend or have children attending schools that meet full demonstrated need (myself included) so the it seems that the outside scholarship does not reduce a lot of money especially 1st year when your subsidized loan caps out at approximately $2650 and the average workstudy is ususally no more than $2000 so it looks like a $10,000 outside scholarship does nothing for you.</p>

<p>The reality is that the majority of the schools do not meet 100% of your demonstrated need and many gap. So in this case finding and recieving outside scholarships can significantly reduce your debt.</p>

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<p>I'm glad I'm not the only one this stuff happens too.
I received my financial package a while ago, and it was great. Then I got my updated one, which listed my honors college scholarship ($500). It took away from my grants and so my package was $100 lower then the previous one.
Now I've got harder classes and less money. Go figure :P</p>

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<p>See my post on this thread (<a href="http://talk.collegeconfidential.com/showthread.php?t=56799%5B/url%5D"&gt;http://talk.collegeconfidential.com/showthread.php?t=56799&lt;/a&gt;) for an explanation as to why it works this way. This is not usually a matter of "college choice" but rather is a Federal requirement. Outside scholarships are a resource and must be taken into account against need first.</p>

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<p>Does it seem unjust to anyone that the money students work for through scholarship applications, writing essays, etc., actually ends up, in most cases, in the pocket of the colleges? If what they adjust first is the grant money, then the colleges are only saving themselves money. I suppose this has the advantage of allowing more students to receive grant money, but also seems like a screwy way of doing things.</p>