Scholarships: How do they impact financial aid packages?

Paying for College
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<p>I applied early to a university. I was accepted and I received a tentative financial aid letter. The cost of attendance is $50,066 and my total grant eligibility is $27,042 (I told the Financial Aid office that I am not interested in loans or work study). Recently, I was awarded a small scholarship. For calculation purposes, let's say that the scholarship is $30,000. Therefore, if you subtract $30,000 from $50,066 the left over amount my family would have to pay is $20,066. Does this mean that my total grant award of $27,042 will cover the amounts that my scholarship does not cover? Would I be going to the school essentially "for free"?</p>

<p>I am looking at my scholarship letter, and it says that additional financial aid is provided on top of the scholarship to students with demonstrated need. The financial aid letter, on the other hand, says that "any honor/merit scholarship or other source of financial gift aid that you might subsequently be awarded will have an impact on your grant eligibility and could cause a revision in your overall award."</p>

<p>I worked hard for the scholarship, and, obviously, my family is eligible for aid. Even with the scholarship, however, I am unable to afford the gaudy cost of attendance of $50,066. Will financial aid officers award me enough grant money to cover the amount that my scholarship does not?</p>

<p>Thank you!</p>

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<p>I don't have the answer for you, but am curious to see what others think. My impression has always been that any outside scholarships first effect the loans you may take out. For instance, if you were planning to take out a $5000 loan, but get a $2000 scholarship you can reduce the amount of loan needed to $3000.</p>

<p>It might be helpful to those answering if you post the actual amount of the scholarship you received. Unless you typed an error, a $30,000 scholarship is by no means small and would definitely have a different effect than a truly small scholarship - like $1000. You might get more responses if you provide an accurate figure - just tryin to help...</p>

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<p>I received a full tuition scholarship.</p>

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<p>Sorry I'm still confused. You received a full tuition scholarship to the $50,000 school? If so, why are you worried about grants? </p>

<p>Here's how I understand it works: a hypothetical situation...</p>

<p>School costs $30,000</p>

<p>Your Efc is $20,000
An outside scholarship you receive is $2000</p>

<p>$30,000 - $22,000 = $8,000 left to be covered.
The school may give you additional grants to cover this or you have to come up with the $$ through loans or more scholarships or more $ out of your pocket.</p>

<p>Outside scholarships usually lessen the loan amount you need to borrow. If you weren't borrowing loans, I would think the school would just lessen the grant amount. </p>

<p>Anyone? Correct me please if I'm wrong. This is my best shot - but I certainly don't have all the knowledge cause I'm a first time newbie at the college game...</p>

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<p>you are going to have to call the school on this!</p>

<p>generally, outside scholarships take the place of the amount the school is gapping first, then the self-help portion of the financial aid package (work-study and loans), then the grant portion of the financial aid package, then the parent contribution, then any student contribution that may be required. But that is for "outside scholarships", scholarships awarded from an organization outside of the school.</p>

<p>It sounds like you are talking about an "institutional" scholarship, one that is given by the school. Each school deals with this a little differently. You may very well be able to combine the full-tuition scholarship with the grants you were already awarded (hopefully) however, some schools may refigure your "need" and adjust your financial aid package.</p>

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<p>"Recently, I was awarded a small scholarship. For calculation purposes, let's say that the scholarship is $30,000."</p>

<p>I'm confused too. A 30K scholarship isn't small in anyone's book.</p>

<p>Generally, after you've been offered a finaid package from a school, if you receive an outside scholarship, it gets deducted from the finaid package. Many schools reduce loans and work study first, but if your finaid package only includes grants, they will likely reduce that (since your need has been reduced by the scholarship). You can't get need based aid if you no longer have the need, ya know?</p>

<p>If it's an in-house scholarship at the school-- then I'm really confused, since it should already be included in the aid package.</p>

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<p>Thank you for everyone's reply</p>

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<p>30K for 4 years isn't excessively large, is it? Or is it 30K per year? Because that's pretty awesome.</p>

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<p>congtates for $30,000 scholarship. Is it JKC College award? </p>

<p>JKC awards covers your summer/work study and any loan from school including free tution upto $30,000 each year in college.</p>

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<p>
[quote]
Recently, I was awarded a small scholarship. For calculation purposes, let's say that the scholarship is $30,000. Therefore, if you subtract $30,000 from $50,066 the left over amount my family would have to pay is $20,066. Does this mean that my total grant award of $27,042 will cover the amounts that my scholarship does not cover? Would I be going to the school essentially "for free"?

[/quote]
</p>

<p>to add on to blake's and Stef's explanation, it does not quite work that way.</p>

<p>Is the scholarship an outside scholarship or does it come from the college?</p>

<p>If it is an outside scholarship, this is how it woudl go.</p>

<p>If there is a gap (unmet need, not your EFC), that would be closed first.
then the scholarship would be applied as follows:</p>

<p>If there is a self help portion to your aid package, it would be applied there first.</p>

<p>any monies left over would then reduce the need based grant aid, sometimes $1 for $1 (check your school's website to see how they handle outside scholarships because your inidivual mileage may vary).</p>

<p>According to your scenario, the entire amount of your grant aid of $27,042 would have to be wiped out before anything could be applied to your EFC.</p>

<p>If the scholarship is coming from your school, it woudl be packaged like your financial aid.</p>

<p>If your cost of attendance is 50,066 and your EFC is ~23,000 (judging from the eligible grant aid amount of $27 042), and your school gives aid based on demonstrated need, then IMHO, I think that the $30,000 (school scholarship) would replace any need based aid that you would get because it is more than your demonstrated need and you would not be getting any additional monies in terms of need based FA (as your EFC is what your would have to pay anyway).</p>

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<p>"I am looking at my scholarship letter, and it says that additional financial aid is provided on top of the scholarship to students with demonstrated need."</p>

<p>What this generally means is if, after applying the scholarship, there is still demonstrated need, then you are eligible for additional Need based monies. This does not mean that if any part of the cost of attendance isn't met, you can still get more money. It means that if, after you take the cost of attendance and subtract the scholarship, the remaining cost is above your EFC, then you get more need based money. If, on the other hand, the remaining cost is at or below your EFC, then no money. </p>

<p>Cost of attendance is $50,000 - $30,000 tuition =20,000. If your EFC is 21,000, no additional money. If your EFC is 18,000 you could get $2000 additional. </p>

<p>Because you turned down loans and work study, your case is a little different. Did the original grant bring your cost of attendance down to your EFC? It could be that they normally package need as grants, loans and work-study. Since they only gave you the grant money, you may have unmet need that would have been covered by loans and work-study. If that is the case, you will get that unmet need covered by your original grant and have to pay less than the 20,000 you currently figure. </p>

<p>Each school figures EFC a little differently as they have latitude with the institutional money they disperse. Call the University and see what they calculated your EFC at. When all is said and done, you will end up paying that much unless you get additional merit scholarship money. </p>

<p>Also, please keep in mind that cost of attendance covers not only room, board and tuition but also books, travel to and from home, and personal expenses. The cost of just room, board and tuition will be less than the total cost of attendance. Subtract the scholarship from that figure and see where that leaves you.</p>

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<p>
[quote]
Also, please keep in mind that cost of attendance covers not only room, board and tuition but also books, travel to and from home, and personal expenses.

[/quote]
</p>

<p>Most of the time, monies for books, travel to and from home and pocket money are covered by the student contributionof the EFC, and work study . The college ususally does not give extra funds to cover this expense should the student turn down the self help portion of their aid package (the student will just have to find another way to fill the gap).</p>

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<p>sybbie719 - Interesting. I've helped a few low income families with the financial aid side of college in the past. Generally, the Cost of Attendance used to calculate their need included books, travel and personal expenses. While they were offered work-study and expected to contribute from summer work, when they received outside scholarships, they were allowed to keep grants + scholarship up to the cost of attendance. The scholarships replaced the work study and expected summer contributions that were going to the cost of personal expenses, books and travel. In a couple of cases, the students had turned down work study/loans that would have covered those things but the schools still let them keep scholarships + grants to equal total cost of attendance. Final outcome was university cut them a check for extra cash up to the total cost of attendance. Now, the schools would not let them keep anything over the cost of room, board, tuition and fees, a unviversity set amount for books, travel and personal expenses.</p>

<p>These students generally had EFCs from $0 to $5000. Obviously, the best place to find accurate advice on anything with Financial Aid is the school itself. That's where I always suggest anyone start.</p>

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<p>It's interesting.</p>

<p>DS is looking at a school that costs $42,000. We are hoping for the trustee's scholarship (merit money) which is $15,000 per year.</p>

<p>Since our EFC is $20,000, I guess we should not care at all about the merit money. It really doesn't matter. Give it to someone else whose EFC is $27,000 plus.</p>

<p>Right?</p>

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<p>SBDad - Yes and No. Depends on how they package your 22,000 aid and if they meet 100%. If heavy on loans and light on grants, then the scholarship will help more. If heavy on grants, not so much. </p>

<p>Also, if you had a major windfall such as winning the lottery and your EFC shot up to 30.000 in next four years, then you'll be glad for that 15,000 scholarship because they won't take that away if GPA requirements are met.</p>

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<p>sorry keepmesane, I should have clarified. You are right in the fact that if a student gets an outside scholarship that wipes out the self help portion (loans and work study) the school will just return the student a check in that amount. Many low income initiatives, example (HEOP, Seek and College discovery do give book stipends as part of their financial aid awards). </p>

<p>However, as we both stated, self help is usally part of the financial aid package. IF the student decides to reject the self help portion of the financial aid (which the OP is essentially doing) the school is not going to increase the need based aid to make up the difference.</p>

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<p>
[quote]
Generally, the Cost of Attendance used to calculate their need included books, travel and personal expenses. While they were offered work-study and expected to contribute from summer work, when they received outside scholarships, they were allowed to keep grants + scholarship up to the cost of attendance. The scholarships replaced the work study and expected summer contributions that were going to the cost of personal expenses, books and travel. In a couple of cases, the students had turned down work study/loans that would have covered those things but the schools still let them keep scholarships + grants to equal total cost of attendance. Final outcome was university cut them a check for extra cash up to the total cost of attendance. Now, the schools would not let them keep anything over the cost of room, board, tuition and fees, a unviversity set amount for books, travel and personal expenses.

[/quote]
</p>

<p>That is absolutely correct. It is nice to see the repetition (3 times I think) that the total NEED BASED FINANCIAL AID a student receives cannot exceed his or her cost of attendance. The COA is the total number for EXPECTED costs and it does include books, personal expenditures and travel, among others. The financial aid comes from the other side of the ledger. It's only getting confusing when trying to mix numbers from the cost and resources. </p>

<p>There is, however, one caveat: students CAN exceed their COA if they do not received any need based awards but 100% merit based scholarships. The restriction of not exceeding the COA is based on federal regulations.</p>

<p>PS Some schools --such as Brown-- do not allow for outside scholarships to replace expected summer earnings. The school will reduce its award or let you play a bit of a "game" by adding a computer to your COA. No matter how, the student will either work or borrow the money for the summer expected earnings.</p>

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<p>So, sybbie and keepmesane, what you are saying is that my scholarship would essentially negate my need-based award?</p>

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<p>Sorry to double post, but my limited knowledge of financial aid tells me that there are two ways of calculating fin aid money: institutional and federal.</p>

<p>If my scholarship really erases the money I would get from the school's method of calculating need-based aid, would I still be eligible to receive need based money from the federal methodology?</p>

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<p>All good points keepmesane.</p>

<p>The schools we have applied to meet 100% of need and cap loans at about $3,000 per year, so I guess my logic works under those circumstances. But you certainly are correct in pointing out the other variables.</p>

<p>Oh, and that lottery thing - let's hope so.</p>