If she is taking loans out, are any subsidized? Any need based aid can be affected by scholarships
“3kids2dogs I think that these local organizations work very hard all year with fundraisers in order to give out scholarships to ease the financial burden for these kids. I’m sure they would not be happy to learn that all of that hard work was for nothing, that it did not help the student in any way.”
These policies are neither new, nor kept secret. Any organization which has been in the business of giving local kids scholarships has known about how it works for years- it’s not like the colleges woke up in 2019 and secretly enacted this. There might be a local realtors association or the garden club which is in the business of awarding $50 checks for books and what-not- and perhaps they don’t understand how financial aid works. But anyone giving out substantial scholarships knows how it works.
I also disagree that the scholarships “don’t help the student in any way”. Most colleges will eliminate the loans first before the grants- so a kid who gets to go to college without loans (or smaller loans) is indeed helped quite a bit. And in the instances where a kid gets “overfunded”-- i.e. the combination of a Pell grant, the schools own aid, plus outside money-- most colleges will work hard to figure out a workaround, i.e. designate a grant to buy a computer for example. Which also helps a low income kid who might be showing up with a 15 year old laptop donated by his or her guidance counselor.
But the main message- this is not new, and the colleges don’t hide their policies!!!
I guess it’s the old adage of, you learn something new every day. Is the way each college treats scholarships available somewhere for applicants to view, or is it common to email the financial aid office of each school and ask how they treat outside scholarship funds?
^^Financial aid policies, including how outside scholarships are treated, should be on each college’s website. If not, or if it’s not clear, definitely contact the financial aid office.
I agree that it is not fair that a full pay student, even from a multi millionaire family can pocket the equivalence of a merit scholarship whereas the student on financial aid cannot use it towards EFC. It reduces that student’s financial aid.
So, it is possible, and actually doeshappen that a student who gets $20k in a school financial grant, and then gets $20k in outside scholarships, loses the financial aid grant and still owes the same amount to the college as if he did not get the scholarship,
Usually, the scholarship would reduce Workstudy and subsidized loans first. Also some schools will not reduce PELL grants. But let’s say, the student get $5500 in subsidized loans and $2500 in work study and $12k in financial aid grants. That student would lose that $12k in grants if he got that $20k in outside money, after $8k in those loans and Workstudy are replaced Of course, the student can find non work study jobs (hopefully) and take out the $5500 in loans on a subsidized basis. But the family does not get $12k relief on EFC.
The reason it works this way is because financial aid is just that—AID for NEED. The only reason why a student gets that money is because family is deemed unable to pay it. Not because of any merit. It’s not a prize. It’s pure need because you don’t have enough money by their calculations. So the instant you get some money, including from some scholarship, you lose that aid because you don’t need it anymore. The financial aid money is to be used ONLY for need.
3kids2dogs - if you are going to state school (and our state school has no grant aid), or a small school that doesn’t have much in grant aid, this may be different.
my kids’ schools gave merit aid to my kids the first year both were in college. No need based; and no subsidized loans. (state flagship and small NAIA LAC).
I called both about outside scholarships; and both said no need to report to the school. I think outside scholarships are at issue when the school gives grants and and the kids get need based aid.
S15 had tuition covered; I asked the school many times to not have S15’s small, yearly scholarships go towards fees, as we could claim them with AOTC. But they wouldn’t put it towards R&B; and in my mind, I thought that it was probably not what the intent of the donor would want. Those department scholarships really didn’t make a dent in our finances; they were a wash. He could have used that extra for his R&B needs. I wish there would have been some case-by-case policy.
@3kids2dogs - I have been able to find it on a lot of college websites, but if there’s a college of particular interest, I don’t see any negatives to contacting the financial aid office directly.
Regarding being told not to tell the university you commit to about outside scholarships: in our case, there was no mention one way or the other. To anyone in our child’s graduating class. We are not eligible for need based aid. Some of our children’s friends were.
We are considering settling up a local scholarship, and I’m already working on the text for the recipient letter. I plan to include text to encourage them to take all their scholarship award information and having a conversation with the financial aid department - we’re willing to be the “last” scholarship, and delay distribution if that would help. We’re not willing to go beyond undergrad, however. We’ll see how this works as we get closer to actually setting it up.
I was shocked to learn that too @3kids2dogs when I first came here when my daughter was a senior in high school. And I was stressed about affording college the entire senior year. This website was so helpful for teaching me the painful realities in the nick of time.
We did not qualify for financial aid, but, my daughter did end up earning a full tuition merit scholarship from her private school, offered at the 11th hour, that allowed stacking of scholarships, and she applied for many local scholarships during the second half of senior year and won close to $7000. Spending an hour or two on an essay to win $500 or more was a great pay off in my opinion. Her full tuition scholarship alone cut our planned budget per year in half, and those scholarships cut the freshman year expenses in half again. She did report them all to her school as required, and more than half of them were sent directly to her school on her behalf. So it is possible to pay less than EFC. But, my daughter only applied to one need only school and that was a $75 dollar folly. The rest all had merit opportunities.
She just graduated, no debt, and has already started her PhD program because she learned that she could start earning her stipend if she did one of her lab rotations during summer term. She moved to her new city about a month ago and is self supporting now.
You cannot be the LAST scholarship if federal and some states’ aid are involved. Nor can you if the college policy dies not permit. They have precedence over the outside scholarship to be last if they so choose. In fact, they generally come AFTER federal and state because they control that order when distributing their own money. It’s not your call
FYI for the newbies- many of the local scholarships are for one year only.
So the pain of having to give back some of the need based aid is mitigated- those rotary scholarships and so forth typically are for freshmen year, leaving the full amount of need based aid available for the last three years.
Actually our rotary scholarship is 4 years, as is the $18,000 from her university, the rest are a one and done. She is our 3rd in college, have 2 in this year, and then our twins will be going in a couple of years.
I don’t believe in need based financial aid at all. Why should a school cover the tuition for some students but not for others based on the family income. Many of us were told at age 18 “It’s been nice having you, you are on your own” so I don’t agree with charging one student $20k for tuition and other $50k. It’s just not fair.
But it’s not my money and not my choice. Did my kids take the need based money? You bet. Did I think that was fair to other students? No, but that’s the system we were put in. I also don’t agree with magnet or charter schools because I think they pull the best talent from other public schools, but one of mine went to a magnet and one to a charter because those were the options we had to live with.
If the school is awarding any kind of government aid, including unsubbed loans, they have to know about the outside scholarships. It won’t matter, but the FAFSA forms require reporting outside scholarships.
Another place where reporting outside scholarships is required is for athletes. An outside scholarship based in any part on athletic performance might be disallowed.
@cptofthehouse yes, thanks for clarifying that. What I could have said better is “last outside scholarship”. For example, would it help for us to not distribute until the sophomore year? We’re willing to be that flexible. Just not beyond senior year of college - and we’re hoping to focus on non-need based applicants.
The top schools want top talent and a diverse community which includes those who cannot possibly pay for college. Thus, we have financial aid. The system is not perfect in that some do fall between the cracks. Sometimes they make out, sometimes they lose out.
OK everyone - looked at the financial aid page of a school my daughter recently visited and really liked.
It says this:
“One thing to keep in mind is that non-institutional scholarships may affect the amount of need-based financial aid you are allowed to receive in your total financial aid award.”
I’m focusing on the words “need based”. given her GPA and test scores, this particular school based upon OOS scholarships on their website, would likely give my daughter a merit based scholarship that would bring OOS tuition down to in state levels plus a little bit. It would leave us with @$20,000 to pay including room and board, which is below our EFC, so I would not anticipate any need based aid.
I know final the answer is - call the school; but she’s just a junior and not even applying for another year. However, based on this wording, would her merit based award be “safe” if she went after some scholarships?
In general, merit based awards, are not reduced by outside scholarships. I say, “in general” because I’ve come across some real hybrids, need within merit, merit within need awards and have no clue how any given school might treat them. For example, there could be grants that financial aid gives to those who have merit AND need with some amounts spilling over the need portion. You would have to have at least some need to be eligible for the award.
I don’t think most of us can say absolutely how every single college would treat these kinds of awards. A college can pretty much do as it pleases with its own money. But from what I have seen, what a college designated as merit money is not reduced by outside scholarships.
I wanted to say, in my daughter’s case, our parent contribution was determined to be a bit over $2000- they gave work study but no loans, and grants to cover the rest. We do not actually have $2000, so for us it was moot that this was ridiculously generous. My daughter’s outside scholarship can cover her work study but is not permitted by the college to pay our portion… but… they do have a way to help anyway. My D will take a subsidized loan for our portion. Upon graduation her scholarship will pay off her (relatively small) loan. I do think that might be a fairly unique thing to this particular scholarship though.
When financial aid awards did not meet need as defined by the college, I have not seen them reduced by outside scholarships. Federal aid does not have to be reduced if the family is paying more than their EFC.
There are exceptions, such as in my own state, where awards like the Excelsior scholarships are not really scholarships but a form of aid applicable only to the tuition and are “last dollar”.
What scholarship will she get post graduation?
She also may not qualify for work student because she’s maxed out the FA, but she can just get a job. That’s fine and may people work jobs that aren’t work study.
@twoinanddone the reason the scholarship cover the work study is they don’t want them to work. That said, she could get a job. As for the scholarship, it’s not one she’ll get after graduation. Her current one has a whole process in place for the loans to be forgiven. It’s not a new scholarship, it’s her current scholarship.