<p>I have a junior and I'm all ready to apply for all of these outside scholarships next year. But I'm failing to see how it actually will help. </p>
<p>For example, just estimating, if EFC is $25,000 and say Northwestern is $50,000 and they pay 80% in grants ($20,000), National Merit of ($2,000) and an outside corporation scholarship ($4,000). How does any of these extra scholarships help out with our EFC of $25,000? Like Rotary Club, Walmart, Coca Cola, etc? Is it not even worth applying?</p>
<p>I don't completely understand you example, but there are cases where it doesn't help that much to apply for scholarships. Sometimes it just diplaces some other aid you'd otherwise be getting from elsewhere (usually the college's own institutional funds) and is not applied to your EFC at all.</p>
<p>You are right. It helps only to free the student of his or her contribution and then is starts to decrease what the school gives in financial aid. That being said, it depends on the type of financial aid the school can offer. Some schools include loans in the aid package, so your outside scholarship will replace that portion of your package (a very good thing). But if the college has a "meets full need" and no loan policy, then the outside scholarships do not help beyond the eliminiation of the student's work contribution. There are many colleges that do not meet full financial need and/or include loans in the financial aid package. In those case, and in situations where your parents do not qualify for any financial aid, outside scholarships are great. Another benefit is that when you are applying to college and they see you have a $100,000 scholarship from Intel STS, they not only like the fact that you are an academic star, they also know you can pay a big share of your bill.</p>
<p>Outside scholarships are handled in different ways by different schools. The most common way I have seen them used is replacing loans. You do not know where you will be accepted and what your financial aid package is going to be until they arrive. It is possible that an outside scholarship will not be helpful at some your schools, but it may well be very useful in others.</p>
<p>Curious77 - I guess that is my question. If someone got $100,000 outside scholarship does any of that help to reduce the EFC at like a top school that does not give merit scholarships. Are we stuck with paying that $25,000 no matter how well student does on scores or if they are top in their class? National Merit is a very nice award but I don't see how it really helps reduce the cost all the much at a top school.</p>
<p>stockmom, I will be interested in the answers you receive to this question, but my experience so is that the parents' expected contribution is not generally ever decreased by scholarships. They can reduce a "gap" in cost not covered by other aid, student loans, term-time earnings (usually work-study), and ocassionally (but not often) student summer earnings expectations. I have heard of students getting to use some "excess" aid to purchase a laptop, and in one case a bassoon needed for a music major.</p>
<p>But generally nothing is directed toward reducing the parents' EFC, where it's been determined they can contribute x-amount. Now I hear there are truly "full rides" out there, that I guess just cover every thing... including the parents' EFC... maybe for athletes or other very special applicants.</p>
<p>In my son's case, he gets a great aid package from his meets-full-need/no-loans college. He did get a small scholarship last year and it was used to reduce what they expected him to earn through work-study. Had he gotten a scholarship large enough to completely cover that amount they expected from work-study and then some, the excess would have gone to reduce the amount of institutional aid he receives from the school. It would not have gone to reduce our EFC or his expected contribution from summer earnings.</p>
<p>Had he received some giant $100,000 scholarship, I assume they would consider that money available to pay for his college over more than one year, and adjusted his institutional grant aid accordingly. I don't believe it would, however, reduce our EFC.</p>
<p>My daughter is applying like crazy for scholarships. She gets a certain amount of need-based aid from the federal and state government, some for maintaining good grades in college, but it doesn't cover the cost of attendance. Anything she can get in scholarships is money she doesn't need to get elsewhere (meaning that we pay it even above our EFC, or she pays it, or she borrows it, or she earns it at a job.)</p>
<p>the entire fastweb scene is too cumbersome to deal with. colleges recommend it, but the application pool is enourmous and a lot of work. I have never heard of anyone, locally or even here that has won anything there.
We learned that with the first daughter and opted out for second. Both strong students , but it was more beneficial to concentrate on a local level with fewer applicants.</p>
<p>With the workload as seniors in rigorous classes, and having to compose essays for almost any scholarship app, we chose to do what we did and reaped rewards..
I realize every case is different , but it worked for our family</p>
<p>Some schools will allow you to apply your outside scholarship money to expenses they don't cover with their aid before they reduce your aid.</p>
<p>As someone said above, one of the first things they will reduce is the student's work study. However, I've heard of SOME colleges allowing the money to be applied to other things before they even look at work study. Examples include a travel allowance (to get back and forth to home on school breaks), a computer allowance, a book allowance, and a reduction in the amount they "expect" the student to bring to the table from a summer job.</p>
<p>So...suppose your student wins a $2,000 scholarship. A school MAY be generous and not reduce the aid package at all, figuring a computer and printer could cost that much.</p>
<p>Stockmom123: i will pm you specific numerical example, but the short answer for a top college that meets all financial need with no student loans and no merit scholarships is: No- the parent remains stuck with the same amount of contribution obligation.</p>
<h2>Stockmom--Here is an excerpt from a post I made some time back, because I had never heard anyone just come out and say it:</h2>
<p>Big Surprise #1: Understanding your EFC
Financial Aid is not intended to help you pay your EFC. It is assumed you will pay the EFC in full out of your pocket.</p>
<p>The remainder you will owe, after you have paid your EFC, is called need. This is the target number the college uses to figure how much need-based financial aid you may qualify for. </p>
<p>An example:</p>
<pre><code> $25,000 Cost of Attendance (Tuition, Room & Board, Books, certain other expenses)
</code></pre>
<ul>
<li>$15,000 EFC (The amount you are expected to pay)
$10,000 Need</li>
</ul>
<p>Read the following sentence twice:
Any need-based financial aid you would be granted (in the above example) would be based on you needing $10,000, NOT $25,000. </p>
<p>Even at that, many colleges do not offer you enough financial aid to meet your full need.</p>
<p>Surprise #3: Outside scholarships may reduce your financial aid.
Say your kid is industrious and gets a number of small scholarships through your high school, home community, and your place of business. Your college may have a formula whereby a portion of those outside scholarship funds will be used to reduce the amount of money the college will give you. Look carefully on the financial aid section of the college website for the statement of how they deal with outside scholarships.</p>
<p>Depending on your EFC, and the school policy, it may not help. With an EFC over $50,000, there is no need-based aid, so any scholarship reduces our cost.</p>
<p>No, that's not correct. Again, you do not know what your financial aid package is going to be. You may very well find that the small scholarship reduces loans or work study (or student earnings expectation). Why would you not want to reduce those things?</p>
<p>I have to interject something here. If a college is giving you grants, those are based on need. If you bring a scholarship to the table, you have that much less need. Therefore, it makes sense that your need based aid is decreased accordingly. It might "seem" wrong, but it really is not ... less need = less need. </p>
<p>The bottom line is, need based aid is used to bridge the gap between EFC and Cost of Attendance. For many, many students, the scholarships are not going to reduce anything except Stafford or PLUS loans. To say that it's not worth it to get scholarships is only true for a small percentage of students - and you won't know if you are in that percentage until you get your award letter.</p>
<p>If you have outside scholarships, you have more flexibility. You do not have to accept the scholarship if you choose to go to a school where your situation would be not be improved to have that outside money. Yes, there are scenarios where that can occur. </p>
<p>When you start your college search and applications, you are not likely to know where you are going to get your offers and what financial packages will be included with them. I have a friend with a child at a school that does not tend to meet EFC. That was where the young lady wanted to go. Without a number of outside scholarships, it would have been a more expensive option. She's paying more than she would have for a state school, and about the same if she stayed home and commuted to a private school. None of her choices met full need, so whatever outside money she ended up getting reduced the gap for her. Still more loans than I personally feel she should take but everyone is happy with the deal. without the $10K in outside scholarships, it would have been even more expensive for her.</p>
<p>Well for me it was surprising to see that all of the scholarships my son was earning to ease his parents burden ended up not helping reduce our contribution. As I have said, this situtation applies to colleges that meet full need and have a no loan policy. We were very disappointed becasue, as many of you know, what the college or FAFSA state is your need disagrees with what your empty bank account and your home equity loan say.<br>
Of course I am happy for my son that his expected contribution (as required by the college award letter) is wiped out by his scholarships. We just had hoped it would help the parents also.<br>
Another point is that I believe this situation applies to most middle class families who have children that attend this type of college and not just a small percentage as another poster said. The lesson is read the financial aid website carefully so you are not surprised.
Summary: Outside scholarships reduce in the following order: 1) student's contribution, 2) student's loans (stafford, perkins), 3) reduce the grant aid given by the college.
Caveat: Check with the college your child will attend.</p>
<p>Does that mean that Yale meets everything beyond your EFC? Whether it is by loans or workstudy or grants? Or do they make everything up with grants? Or do they pay your EFC? ...I know silly question but inquiring minds want to know :)</p>