At this point, my S19 has applied to about $65,000 worth of 3rd party scholarships. Most are highly competitive and it is unlikely he will win more than one, or even one.
However, what if his dream comes true and he wins scholarships totaling more than the school’s COA? Let’s assume the scholarships pay the school directly (as many do.) Will the excess money be forfeited or will it be applied to later years? Or is there some other outcome?
For example, S19 is considering an in-state public school whose COA is $26,000. What happens if he wins $30,000?
You need to check the policies for those scholarships. Some will be forfeited. Some will be able to be deferred to a subsequent year. Some might be refunded to your student…although that is the least likely of these scenarios, in my opinion. College scholarships are not supposed to be profit making. They are meant to cover the cost of attending a school.
But check.
Also, keep in mind that some schools will add things like computers or other necessary items to your cost of attendance…some schools.
If he receives need based grants from the college that will likely be reduced or eliminated. Also any scholarships over the cost tuition and academic fees is taxable I believe.
He’s not expecting any money to be given to him directly. I’m just hoping that in the very fortunate case where there is a little left over, it will be applied to subsequent years.
Most of the schools that he has acceptances to have offered him ‘need-based’ subsidized loans and not much else. I suspect those will remain in place. But I agree with your point on need-based grant money.
@STEM2017 if he received subsidized loans, those are based on financial need. If he receives a ton of outside scholarships…his need will be reduced…and his loans could turn into unsubsidized loans…or if he has aid that exceeds the cost of attendance, those loans could disappear entirely.
Schools cannot award aid that will result in more than the cost of attendance, IIRC.
At Ds school outside scholarship reduced what the school gave out to keep the number at COA. Makes since since the school would love for outside entities to fund a student and allow them to use money for other students. COA for my D was a generous number since it included some miscellaneous $ and the cost for most expensive dorm and meal plan. D dropped official meal plan and fixed own food although did live in more expensive dorm but she was able to keep cost low enough to get overage refunded to her. She actually graduated with money is savings but YMMV depending on school.
It was slightly annoying/amusing when she won several small department awards with checks that were absorbed into her school scholarship and she never got to keep them - even a small award for a poster day win. But no complaints since she went to college free except for taxes on portion of scholarship that wasn’t QEE
Assuming we’re talking about a situation where there isn’t institutional aid to reduce (which is what will happen first, usually), then the vast, vast, vast majority of scholarships will simply be forfeited.
A few MIGHT allow for deferral. Of the 19 outside scholarships I won, only 2 allowed for deferral. So, yeah, he’s probably just gonna lose the money.
The bright side is COA encompasses a student stipend portion (transportation, book, etc allowance estimates) that would be refunded to him. You can usually save a lot of that money by living cheaply.
Community college is probably different than most colleges but DD’17 at times had more scholarships paid to her cc than tuition was for the semester. The excess was refunded to my bank account and I just kept it to help pay for the next semester.
They can only refund the portion allotted for in the COA, though. So if you have 1 million dollars in scholarships more than the COA, you’re not getting that million. You’re getting the portion allowed to refund in the COA.
This is, iirc, per federal law about not dispersing aid over COA. It’s also per basically every scholarship organizations’ policy; no one wants to fund someone’s bank account above the COA.
Hope is such a good thing, right?! What a fun thing to think about! I’m interested in hearing how this turns out.
Some scholarships are only for QEEs; some are for just one year. Once they were awarded and it was all done, I’d be asking the school and the organizations about it; making a spread sheet to maximize the benefits, hoping to defer, and possibly getting a refund. I wouldn’t ask anyone beforehand though!
It is not different, but if she was only paying tuition and fees to the school and books, housing, meals, etc was all paid to outside entities, the school can give that to you up to the COA.
Some of my daughter’s outside money could only be used for tuition so once that was paid, the school could use other funds (including the school’s merit scholarship) to fund other costs. In our case, the school had a policy that it would not refund its own funds even if there was still room in the COA (housing, books, incidentals). In her final year, my daughter got a much lower athletic scholarship than promised because the school used all the other scholarships for tuition and fees first and then there just wasn’t anything left to pay (except insurance, and the school wouldn’t pay that since it was to an outside entity). If daughter would have lived on campus, everything would have been paid but the school would not pay her rent off campus.
Good luck. I hope he gets so much he has to forfeit some!
That makes sense, my DD was paying rent etc. to outside entities and scholarships definitely didn’t cover her housing costs.
DD’19 is applying for scholarships these days too. Can’t wait to know the results. Good luck @STEM2017 let’s hope both our 19er’s are wildly successful!
Many schools expect a student contribution when they figure out any need-based FA, and this often includes a “summer earnings” contribution as well as a loan. Schools with generous FA policies will commonly apply any outside scholarships to the student contribution/loan before they begin to reduce their need-based FA.
Many scholarships have stipulations that they can only be used toward tuition/fees, but some are silent on the issue and can be applied toward the total COA, which would include R&B, but it could trigger the scholarship to be treated as taxable income.
I am not sure I completely agree with the suggestion to wait until they are ALL awarded, and then figure it out. I would ask to talk to the school’s FA department, after they have given their FA package, to see if they have any suggestions and/or experience with any of the outside scholarship organizations. Chances are, they may have dealt with some of these same scholarship groups in the past, but they will help you understand their own policy, and may be able to help give you questions to ask these outside groups - if appropriate at this time.
If the scholarships are not from the school, and if there are no limitations on what the scholarships will pay for (such as “tuition only “), then it’s possible you could receive more than COA. COA is for federal aid … if there is any federal aid in a financial aid package, you cannot be awarded more than COA. Schools are not going to give you any of their own need based aid if you have outside scholarships in excess of COA. If they give automatic scholarships that are restricted to tuition, they may reduce the scholarship if you receive tuition-restricted outside scholarships (or they could reduce their own scholarship even if an outside scholarship is not restricted to tuition, depending on the school’s policies). If it’s all just outside scholarships, and if none of them have policies that restrict how they are awarded, it is possible you could receive more than COA. However, I have worked in financial aid for years & have never seen that situation. It is definitely a wishful thinking what-if, in my opinion.
As someone who actually does have half a million in outside scholarships… no, you won’t be awarded more than COA. No outside scholarship is going to let their award disburse if you’re above COA. There’d have to be some deception for that to happen.
I was just reading an article about the Rhodes scholarships winner from U of Colorado. She has the Rhodes (100% for studying at Oxford), also has a Truman scholarship ($30k) and hopes to be Miss America, which is paid partially in scholarships (plus whatever she wins along the way in state contests). She wants to go to law school, so wants to keep winning scholarships.