Going to university is expensive. According to the Higher Education Councilthe total cost of attendance for resident students at public four-year universities was $27,940 in 2022-23, while nonresident students paid an average of $45,250. Students at private nonprofit four-year colleges spent even more: nearly $57,600.
If you’re looking to reduce your out-of-pocket college costs, Scholarships and grants should be your first choice. Unlike the feds and private student loans, both are a type of gift aid, which means you don’t have to pay them back. This is what you should know.
Scholarships and grants are a type of free aid (money that does not have to be paid back). They are the second largest source of financial aid, covering more than 25 percent of students’ college costs.
- Scholarships, combined with grants, were the second largest source of financial aid in 2021-22, covering an average of 26 percent of students’ college costs.
- The average scholarship was $6,041 in 2022, a 22 percent decrease from last year.
- During the 2021-22 academic year, 60 percent of American families used scholarships to pay for college.
- Among households that did not use scholarships to pay for college in 2021-22, approximately one third applied.
- Among those who used scholarships in 2022, 62 percent they said they got them from their college or university.
- The average institutional scholarship awarded is $6,335.
- Approximately four out of 10 fellows they received funding from their state, with an average award of more than $2,362.
- Thirty-seven percent of the scholarship recipients received money from private sources, including businesses and non-profit organizations; the amount averaged $2,189.
- The average white student received $4,250 in scholarships for the 2021-22 academic year, while black students received an average of $2,303. Hispanic students received the lowest scholarship amount, averaging $2,259.
- In 2021-22, students received a total of $140.6 billion in grants.
- fifty five minutest of American families reported using grants to help pay for their children’s college costs during the 2021-22 academic year.
- Undergraduate students received an average of $10,590 in grants during the 2021-22 academic year, double the amount they received 20 years ago.
- Graduate students received an average of $9,120 in grants, representing an increase of 37 percent over the past two decades.
- Grants for undergraduate and graduate students have increased by 7 percent during the last decade.
- Of all the types of grants, those awarded by institutions have grown the most in the last decade. totaled $74.4 billion during the 2021-22 academic year, representing a 48 percent increase from 2011-12.
- More than a half of all scholarships awarded in 2021-22 came from the students’ institutions.
- Federal grants were the second largest source of funding and accounted for 26 percent of all grant aid in 2021-22.
- State grants were the smallest funding source and represented only 9 percent of all grants in 2021-22.
- During the 2021-22 academic year, 6.2 million college students were Pell Grant recipients.
Scholarships and grants by recipient
When it comes to scholarships and grants, aid is distributed almost evenly among students from different backgrounds, as shown in the graph below. The most notable difference is between black and Asian students. According to the National Center for Education StatisticsAccording to the most recent figures, 88% of black students received some form of gift aid in 2015-16, while only 66% of Asian students received any form of gift aid.
Likewise, there was not much difference between the percentage of men and women who received scholarships and grants in 2015-16. Some 73 percent of full-time male students received free help, while nearly 80 percent of female students received free help.
Scholarships and aid by household income and type of institution
Although private nonprofit four-year institutions are more expensive than attending a public four-year institution, they also offer more financial aid to students.
Data for the National Center for Education Statistics shows that the average cost to attend a public four-year institution in 2020-21 was $20,385, while the average cost to attend a private nonprofit four-year institution was $43,758.
Public institution students, regardless of income, received an average of $7,813 in scholarships and grants. Meanwhile, students at private institutions received an average of $21,011 in gift aid. That means that scholarships and grants helped cover about 38 percent of the costs at public institutions and almost half of the costs at private institutions.
On top of that, students with a family income of $48,000 or less tend to receive substantially more endowments at public and private universities, as shown below.
|$0 to $30,000||$11,386||$26,753|
|$30,001 to $48,000||$10,445||$27,003|
|$48,001 to $75,000||$7,561||$25,012|
|$75,001 to $110,000||$4,392||$22,080|
|$110,001 and up||$2,777||$18,389|
How to apply for scholarships
scholarships They fit into two main categories: need-based and merit-based. Need-Based Scholarships They are awarded based on your financial need to pay for college. Merit-based scholarships are those awarded based on recipients who excel in something, such as academics, athletics, or the arts.
You can also get scholarships if you meet certain criteria, such as majoring in a certain field, being a first generation student or be a member of the LGBTQ+ community. There are also scholarships for women, latino students and many other groups.
Both forms help your school and other entities determine whether or not to award you additional funds based on your circumstances and financial need.
However, merit-based scholarships require you to do more research, as private entities and companies often provide them. You can find hundreds of these using scholarship seekers like Scholarships.com and Fastweb. Although the requirements may vary, they generally include:
- A written statement.
- A copy of your resume.
- Two references.
- A letter of recommendation from one or more sources.
- A copy of your transcripts (especially if a certain GPA is required).
Although this can take a long time, it is worth it. You can get thousands of dollars worth of help simply by filling out a form and following the deadlines.
How to apply for grants
Applying for grants is usually quite easy. Most of them are need-based, which means they are awarded based on your financial need, and you can get them from federal, state, and local governments, as well as from your college.
The most famous and generous grant available is the Pell Grant, which currently has a maximum award of $6,895 for the 2022-23 academic year. To apply for grants, you typically only need to complete the FAFSA and the CSS profile. Not all schools use the CSS profile, so check first.
Both forms will ask questions about your family size, living situation, and household income to determine your eligibility.
What to do if your financial aid package falls short
What skyrocketing inflation makes everything more expensive and University tuition prices risescholarships and grants may not cover your costs. Federal student loans it may not be enough to make up the difference.
If your financial aid package It falls shortyou can use private student loans to close the gap. Unlike federal student loans, however, private student loans are issued based on credit. It’s important to shop around for lenders and compare quotes before signing on the dotted line to make sure you’re getting the right better terms and interest rates available for your situation.
Yes bad credit prevents you from accessing the best rates, you are not stuck with a high interest rate forever. You always can refinance your private student loans once your financial situation and credit have improved. Refinancing can make your debt more manageable and save money on interest.