Understanding the difference between grants and scholarships

As I dive into the financial aid process, I'm a bit confused about the difference between grants and scholarships. How are they different in terms of eligibility, application process, and repayment obligations? I'm trying to understand which one might be more suitable for me as I plan to apply for multiple forms of aid.

Grants and scholarships are both forms of financial aid that do not have to be repaid, making them "gift aid". But they do differ in certain aspects.

Grants: These are typically needs-based, meaning they are awarded based on your family's financial circumstances. They may come from many sources, including the federal government, state governments, and colleges themselves. The most well-known type of grant is the Federal Pell Grant, which is need-based aid provided by the government to low-income undergraduate students. This is determined by factors like your family's income, assets, number of children in college, etc. But some grants might also consider factors like your intended major or career field.

To apply for grants, you'll usually need to submit the Free Application for Federal Student Aid (FAFSA). The FAFSA is used to determine your eligibility for federal grants, as well as for grants from your state and from the colleges you're applying to.

Scholarships: Unlike grants, scholarships are typically merit-based, meaning they're awarded based on some kind of achievement or talent, such as academic, athletic, artistic skill, or community service. While there are need-based scholarships as well, the emphasis is often on the recognition of individual skill or achievement.

The application process for scholarships varies widely: some may require essays, letters of recommendation, portfolios or auditions of work, or other supplemental materials. Scholarships too, can come from various sources like universities, private organizations, or community foundations.

Remember, while both grants and scholarships may help reduce your burdens of college cost, it's essential to read the fine print so you clearly understand the conditions. For example, some grants and scholarships may require you to maintain a certain GPA, enroll in certain courses, or renew the application each year.

Based on your personal circumstances, achievements, and needs, you could potentially be eligible for both grants and scholarships. It's a good idea to pursue all avenues of gift aid, as every little bit can help lower the cost of college.

Keep track of all deadlines so you don't miss out on any opportunities. Consider creating a folder or spreadsheet to collect and monitor all your financial aid materials and timelines.