Merit-Based Vs Need-Based Scholarships

Merit-Based Vs Need-Based Scholarships

A significant number of college students typically receive financial assistance to offset costs such as tuition, housing, and school supplies.

In the 2020-21 academic year, U.S. students collectively obtained approximately $235 billion through grants, tax credits, loans, and work-study benefits. On average, full-time undergraduates received nearly $15,000.

Scholarships stand out as highly valuable sources of college financial assistance, mainly because, in general, they do not require repayment. It is crucial to distinguish between merit and need-based scholarships to optimize your chances of securing financial aid while managing the costs of your college education.

This article delves into the fundamental distinction between merit and need-based scholarships. Additionally, it highlights some noteworthy merit-based and need-based scholarship options worth exploring and provides essential insights into these two categories of scholarship opportunities.

This resource outlines the distinctions between merit-based and need-based financial aid, providing guidance on the application process and securing both types of assistance.

What Does Merit-Based Financial Assistance Entail?

Students are awarded merit-based aid depending on their academic or extracurricular accomplishments rather than their financial circumstances. Scholarships, the prevalent form of merit-based aid, can be granted by nonprofit organizations, private enterprises, and educational institutions.

In the evaluation process for merit-based aid, scholarship committees typically review students’ academic performance, standardized test results, and involvement in extracurricular pursuits.

To remain eligible for such assistance, students often must sustain a specific GPA throughout their college tenure.

While numerous smaller colleges provide merit-based assistance to mitigate tuition expenses, some larger institutions do not follow suit. Notably, Ivy League schools, for instance, do not provide any merit-based aid, although they do furnish substantial need-based aid through their institutions.

In the quest for scholarships, students can explore potential opportunities from their parents’ or guardians’ employers, nonprofit organizations, and community foundations. Many of these entities grant awards to students who demonstrate excellence in diverse fields.

Additionally, prospective students can utilize online scholarship platforms to identify opportunities tailored to their specific majors or designated for students in particular states or regions.

As reported by U.S. News & World Report, the average merit-based award amounted to $11,287 in the 2019-20 academic year, benefiting approximately 22% of all U.S. college students during that period.

What Does Need-Based Financial Assistance Entail?

The most prevalent form of financial assistance for U.S. college students is need-based aid. This category encompasses various forms of support, such as institutional grants, scholarships, state and federal grants, federal work-study opportunities, and federal loans.

The Pell Grant stands out as a widely utilized need-based aid initiative, primarily intended for students hailing from low-income families. In the 2020-21 academic year, approximately 6.2 million students benefited from Pell Grants, with a maximum award of $6,495 for the 2021-22 school year.

Students exhibiting a heightened level of financial need may also be eligible for the Federal Supplemental Educational Opportunity Grant, offering up to $4,000 annually to cover tuition and other educational expenses.

Many state governments contribute to need-based aid through grants, tuition waivers, and federal work-study initiatives. Additionally, various private foundations and businesses extend need-based scholarships, in addition to awards based on merit.

To assess eligibility for need-based financial aid, it is crucial to complete the Free Application for Federal Student Aid (FAFSA). Completing this application each academic year is essential to qualifying for federal aid throughout your college tenure.

Distinguishing Between Merit-Based And Need-Based Financial Aid

University students can obtain financial assistance in the form of both merit-based and need-based aid to support their tuition fees and cover various educational expenses, such as housing and school supplies.

Typically, need-based aid is more widely available compared to merit-based aid, which tends to be more challenging to attain. Achieving and consistently maintaining a specific level of excellence in academic and/or extracurricular activities is a requirement for qualifying for merit-based aid.

It’s important to note that not all higher education institutions provide both types of financial aid. Smaller private schools often offer merit-based opportunities, while larger public universities predominantly allocate financial support based on need.

What Other Forms Of Financial Assistance Are Available?

Students have alternative options for financing their higher education beyond relying on need-based and merit-based assistance.

In instances where funding gaps exist, private loans, typically provided by banks or credit unions, can serve as a means for students to bridge financial shortfalls. It is advisable, however, to consider private loans as a last resort due to less favorable terms compared to federal loans.

Furthermore, certain scholarships extend financial support based on a student’s specific academic interests, while others target individuals belonging to particular demographic groups, including women and students of color.

Here are different categories of scholarships and financial assistance options that are not dependent on financial need or academic merit:

  • Scholarships designed for adult learners and nontraditional students.
  • Scholarships tailored for students with disabilities.
  • Financial aid opportunities specifically for students of color.
  • Scholarships available for LGBTQ+ students.
  • Scholarships dedicated to military dependents and families.

What Are The Eligibility Criteria For Receiving Merit-Based Financial Assistance?

What is merit-based financial assistance? Generally, upon applying to a college and, if necessary, submitting your FAFSA and/or CSS Profile, you are automatically evaluated for merit scholarships.

Nevertheless, certain merit scholarships may mandate an additional essay or supplemental materials for consideration. Hence, mastering the skill of essay writing for scholarships is crucial, and letters of recommendation might also be necessary.

Some merit scholarships might impose specific eligibility criteria, such as GPA and test score prerequisites. Alternatively, they may be restricted to students from particular geographic regions, underrepresented communities, or those intending to pursue studies in a specific field.

For instance, certain scholarships may exclusively target engineering students, while others may be reserved for applicants from the state where the institution is situated. It’s essential to note that specific colleges, like Boston University and USC, necessitate an earlier application deadline for merit scholarship consideration.

Therefore, it is advisable to promptly submit your FAFSA and CSS Profile.

Numerous public state universities, such as the University of Michigan and the University of Texas at Austin, along with private institutions, provide merit scholarships. These scholarships typically range from a few thousand dollars to covering full tuition expenses.

Most merit scholarships are renewable for all four years of undergraduate studies, contingent on the student meeting academic requirements. Colleges usually specify the annual quantity of these scholarships.

Institutional scholarships granted by the school may be based on financial need, merit, or a combination of both. While some merit-based scholarships follow a “need-blind” approach, where the applicant’s financial situation is not considered, this isn’t universally applied. Certain schools may assess FAFSA information for merit scholarship decisions.

Consequently, even students who assume they don’t qualify for need-based aid are strongly advised to submit the FAFSA.

Strategies For Maximizing The Financial Assistance You Receive

Conduct thorough research as each institution varies in its policies regarding financial aid for international students. Determine whether the school operates on a need-blind or need-aware basis. Assess the balance between merit scholarships and needs-based financial aid available for international students.

Reflect On Your Achievements And Strengths.

Explore diverse scholarships tailored to specific interests and activities, aligning them with your skills. Identify scholarships based on your nationality, field of study, or personal identity, such as those designed for first-generation college students.

Strategize Your Approach To Scholarship Applications.

Recognize that many merit-based scholarships may require an essay, so invest time in crafting a high-quality piece. Focus on applying to scholarships where you believe you have a strong likelihood of success.

Merge Various Forms Of Financial Assistance To Address Both Tuition Fees And Living Expenses.

  • An illustration of a potential financial aid package for an international student is provided below:
  • Anticipated family contribution: $5000 each semester
  • Scholarship from a private source: $1500 per semester
  • Financial assistance provided by the college: $4500 per semester
  • Student loan amount: $2000 per semester
  • Aggregate: $13,000 per semester

Securing financial assistance as an international student may pose challenges, but it is certainly achievable. Opting for merit-based scholarships can be a highly effective means of funding your education at a U.S. college.

It is advisable to pursue multiple scholarship opportunities to optimize the overall amount of financial aid you receive. Additionally, ensure you carefully review the criteria for applying for financial aid directly from the college, as the application procedures for international students can vary between institutions.

Final Thought:

Numerous financial assistance opportunities are accessible to support your college education expenses. Unfortunately, many eligible students miss out on the chance of admission by choosing not to apply and submit their applications.

The initial cost of attending a school often doesn’t accurately represent what you’ll actually pay, particularly for those with demonstrated financial need.

To have your financial need assessed, it’s crucial to submit your college application along with the FAFSA and/or CSS profile. Many institutions provide comprehensive financial aid packages that encompass both need-based assistance and merit scholarships.

Additionally, you might qualify for work-study programs, allowing you to secure on-campus employment to offset some of your remaining expenses.

Understanding how need-based and merit-based financial aid functions is essential. For any further inquiries, consider reaching out directly to the financial aid offices.


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