College is expensive, of that there is no doubt. Currently, 43.5 million borrowers have federal student loan debt, and the average student loan debt balance is nearly $40,000. Upon graduation, students will find it difficult to make monthly loan payments while also seeking financial independence, as those monthly payments are often almost as much as a month’s rent. So, what can you do to help reduce the cost of college? By getting free money, of course! Today we’re going to be talking all about different types of grants, and how you can get one. Let’s begin.
First, let’s go over the similarities and differences between grants and scholarships. Grants are similar to scholarships in that they do not have to be paid back (in most cases anyway, but more on that later). Scholarships can be need-based or merit-based; the latter meaning that the scholarship applicant has displayed proficiency in any number of areas. For the most part, grants are need-based, meaning they are awarded based on other factors such as ethnicity, religion, or some other related criteria.
Grants can come from either the federal government, your state, or your college. In order to check your eligibility for federal or state aid, you’ll need to fill out the Free Application for Federal Student Aid (FASFA). Once you’ve done that, colleges that you’ve been accepted to will notify you of any financial aid eligibility. When it comes to grants, you’ll want to be somewhat expeditious as they are awarded on a first-come, first-serve basis.
The way your FASFA determines eligibility for grants is through factors such as the cost of tuition and your Expected Family Contribution (EFC). While filling out your FASFA, you’ll be asked to provide certain information that determines how much money you and your family will be able to pay for your college education. The resulting figure is your Expected Family Contribution. Depending on your EFC, you may be eligible for grants; however, keep in mind that most grants are awarded to those with lower EFCs.
The largest grant program that is offered by the U.S. Department of Education is the Pell Grant. In the event you have a low EFC, you’ll more than likely be eligible for one of these. Pell Grants are awarded to low-income families, with the amount awarded being determined by your EFC. Most recently, the maximum Pell Grant award was around $6,000 per year, while the minimum was $650 per year.
Another type of grant you could try looking into is a Federal Supplemental Educational Opportunity Grant (FSEOG). This one is similar to a Pell Grant in that it is typically awarded to those who require significant financial aid in order to pay for their college tuition. FSEOG is not offered at all institutions, so if you’re still in the application process, keep that in mind as you research the schools you’d like to go to. Those who qualify for FSEOG can receive anywhere between $100 and $4,000 per year.
If you don’t qualify for a Pell Grant or FSEOG, you may also seek financial aid through your school. Grants that are offered by colleges aren’t always tied to a student’s financial situation. As we said earlier, grants are sometimes awarded based on criteria such as ethnicity or religion. Other examples are grants that are awarded to women, single mothers, or veterans. There are numerous types of grants out there, so always do your research as you’re applying to schools and looking for financial aid.
In certain cases, a grant might have to be repaid. The most common scenario is when a student has a grant and withdraws from a program without completing it. Another such case is when a student’s enrollment status is altered. An example of this would be if a student changes from part-time enrollment to full-time enrollment. Other scenarios could be when a student receives additional outside scholarships or grants that disqualify them from federal aid, or have received Pell Grants from multiple schools at once.
You might be eligible for multiple sources of financial aid, so make sure you do your due diligence before you take out a student loan. These days, it’s important to do all you can to mitigate the high cost of tuition, as doing so will allow you to more easily achieve financial independence.