<p>This may sound uninformed, but I recently read that outside scholarships replace financial aid at most schools. Is this true? If this is true, then what is the point of getting scholarships if one is applying for financial aid? For example, if the school I attend costs 60,000 dollars per year, and I receive 40,000 in financial aid and 20,000 in outside scholarships, this is not a full ride but simply becomes 20,000 in financial aid and 20,000 in scholarships? Am i mislead?</p>
<p>It varies from school to school. At some schools, outside scholarships may be used to reduce the family & student contributions, loans & work study. At other schools, they will be applied first to reduce institutional grants. Ask the school!</p>
<p>So I couldn’t fabricate a full ride by receiving 40000 in aid and 20000 in scholarships if the school costs 60000? I would still have to cover 20000 per year at most schools?</p>
<p>“most schools” doesn’t matter. What’s going to matter are the policies at your specific school. </p>
<p>And fwiw, most schools seem to reduce self-help first. Some will then let you use that to pay for your EFC and others will reduce institutional grants.</p>
<p>Ok, I think I understand that. I am only in high school, but I plan on applying to Yale EA. Additionally, I am applying to a few other top universities and liberal arts colleges and am curious as to whether or not I could use outside scholarships to cover EFC at schools like Williams, Vanderbilt, Ivy League schools, etc.? Thanks!</p>
<p>It depends on the school. One school that my D was interested said that the outside scholarships would reduce the student loans first.</p>
<p>In short, no, you can’t fabricate a full ride with outside scholarships on top of need-based aid.</p>
<p>Generally speaking outside scholarships can’t go toward the family contribution. But most schools will let you replace your loans and work study before reducing grants, as well as any “gap” if the school did not meet full need.</p>
<p>So, suppose the school costs $60K and they compute an expected family contribution of $20K. They “meet full need” and give you a $40K package that includes $32500 in grants, $5500 in loans, and $2000 in work study, and expect your family to contribute the remaining $20K. You get a $20K scholarship. Suddenly your need is now $20K instead of 40K. </p>
<p>Scenario a) worst case, your grants are reduced by 20K: You now have a scholarship of 20K, grants of $12500, $5500 in loans, $2000 in work study, and are expected to come up with $20K</p>
<p>Scenario b) scholarships are applied to self help first:
The school changes your package to $20K grant with no loans or work-study. Now you have a 20K scholarship and a 20K grant. You’re still expected to come up with $20K, but since the loans are no longer included in your financial aid package, you can now take out $5500 in Stafford loans to use toward the 20K your family has to come up with. Also although you do not have work-study in your package, you can take a regular job to earn some money toward your expenses</p>
<p>Scenario c) The school applies scholarships to self-help first, and also allows you to increase the COA to cover some additional expenses, such as the cost of a computer, a more expensive meal plan, gym membership, health insurance etc. For this example, imagine you have $3K in additional expenses (that you would have paid for anyhow but were not included in the 60K figure). Now the cost of the school is considered to be $63K. You have a 20K scholarship and 20K EFC, leaving a need of $23K which is met entirely with grants. So 20K scholarship, 23K grants, 17K to come up with to meet the original 60k figure, and you still have the option of taking your 5500 in loans toward that 17K and of working on campus (though not in a work-study job).</p>
<p>From the Yale website:
</p>
<p>Google “name of school outside scholarships”.</p>
<p>So, in Yale’s case, no. You can’t get a free ride that way.</p>
<p>Scenario d) school didn’t meet full need to begin with. $60K COA, 20K compute EFC, but school only gives you $30K in aid, which includes $22500 in grands and $7500 in self-help (loans and work-study). You need to come up with an additional $30K. In this case, your 20K scholarship reduces your need to $20K – if the school reduces your self-help first, then you would end up with your 20K scholarship, 20K grant, and only 20K left to pay instead of 30K, and again you have the loans available to go toward that 20K.</p>
<p>Yeah, I probably should have used my resources more effectively! Thank you all very much!</p>
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<p>This actually does allow you to use your scholarship toward <em>part of</em> your family contribution – the total Yale expects you to contribute includes the “student income contribution” and you are allowed to cover that (probably around 2K of the 20K they were expecting your family to pay) from your scholarship.</p>
<p>In most schools, integration of outside scholarships awards do occur, but to what degree depends on the school.</p>
<p>So why bother to apply for outside awards? Sometimes, there is no reason. If you have been accepted to a school and that is the one you choose to attend, and that school will take 100% of any outside scholarship and simply take away whatever grants it has given you, it makes no sense for you do apply for those outside awards. Or the net result even if it isn’t a 100% loss, still might not be worth spending your time applying for those outside awards,. Better someone else not as lucky as you get those scholarships.</p>
<p>But that situation is truly rare. Most of the time, financial aid awards have self help in them, and outside scholarships will replace those loans and work study awards first. That can mean less debt, or you can turn around and take those loans, if the are the Direct (Stafford) Loans on an unsubsidized basis to use towards your EFC, or use the freed time from workstudy to get a job on your own for extra cash. Lucky indeed is the student who gets such complete financial aid that an outside scholarship will totally do no financial good at all to the student.</p>
<p>Scholarships often best help people who have little or no need. </p>
<p>For instance, if a school costs $60k, and the family has “no need”, then any scholarships that the student gets will reduce what the family has to pay.</p>
<p>My kids had “no need,” so their very large merit scholarships covered nearly all of their college costs, so we paid very little…even tho we have a very high EFC. </p>
<p>Since Yale is a no loan school, outside merit would reduce the “student contribution” and then reduce Yale aid. </p>
<p>Also, there are many schools that DON’T meet need, so if a student has a “need” of $35,000, but only is given $15k in aid ($20k gap), then a $20k merit scholarship would cover that gap.</p>