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How do Scholarships Work?
Scholarships are one of the most common ways for students to pay for college. In fact, according to a 2021 report from Sallie Mae, scholarships and grants were the second biggest source of college funding (after personal savings). But many students wonder how scholarships work and what they need to know about the scholarship application process. In this guide, we’ll be talking about:
- What is a scholarship?
- Who awards scholarships?
- Who gets scholarships?
- How can I use scholarship money?
- So, how do I win scholarships?
Keep on reading to learn more about how scholarships work so you can find and win scholarships to pay for college!
What is a scholarship?
Scholarships are an award of financial support that help students pay for their education. While the most common types of scholarship are for college, scholarships also exist to help students pay for private K-12 education and graduate school.
The major benefits of scholarships compared to other types of financial aid are that they do not need to be repaid and are sometimes renewable, so students can qualify for them for multiple years of their education.
Who awards scholarships?
Scholarships are awarded by a variety of organizations and even individual people. Organizations that award scholarships include colleges and universities, nonprofits, small businesses, major corporations, the federal government, and state governments.
Who gets scholarships?
Scholarships are awarded to eligible students! Because there are so many different types of scholarships, the types of students who receive scholarships can vary.
Many scholarships are academically-focused, while others seek to award students with specific talents including writing, art, music, or athletics.
And then there are other scholarships such as easy scholarships and no essay scholarships that are more akin to contests and winners are chosen at random.
Related: What are the differences between scholarships and student loans?
How can I use scholarship money?
Scholarships are meant to be used for educational expenses which include mandatory tuition, fees, books, and other supplies. This means that you should be using your scholarship awards on these educational expenses. The other reason for doing this is that it ensures that your scholarship money is not taxable.
However, every scholarship will be awarded in a different way. Some organizations will send the funds directly to your college, while other organizations will directly send you a check. If you receive a check, you can technically use the funds on anything, but we strongly recommend that students use it as an investment in their education. Plus, you may owe taxes on money spent on non-mandatory educational expenses.
Also see: Do I have to pay back scholarships if I drop out of college?
So, how do I win scholarships?
Now that you understand the basics of how scholarships work, no doubt you’re wondering how exactly you can go about earning them. Luckily, our website is chock-full of resources to help you along the way. We’ll divide the process up into two main sections: Finding scholarships, and crafting successful applications.
Finding scholarships
Finding scholarships is the big first step to take when you’re looking to fund your college education. One of the best and most overlooked methods is to look for local scholarships. Asking for help from your high school counselor or consulting local community organizations can put you in touch with scholarships for people specifically from your town or neighborhood. These opportunities will have far less applicants than national ones, meaning you have a better shot at winning.
Another great tool is our free scholarship search engine. This tool provides a great array of constantly-updated, vetted scholarships at your disposal, custom-suited to your demographics, interests, background, and more. Sign up today to be automatically entered into our no-essay scholarship competition!
Winning scholarships
Now that you’ve found some great opportunities, it’s time to get applying! Scholarship applications are a unique skill that have quite a bit in common with college applications. It’s important to write an effective essay to stand out. Try our “Show, Don’t Tell” essay primer and our guide for writing winning scholarship essays. You can also consult our guide on how to write an essay about yourself and how to tailor your essays to 250 or 500 word limits.
Key Takeaways
