Paying for college
Scholarships & Grants
Scholarships and grants are money for school that you do not repay. This section covers every stage, from understanding how awards work to submitting a winning application.
Scholarships and grants are awards that pay for school without requiring repayment. They come from governments, colleges, and private organizations. Eligibility depends on merit, financial need, identity, field of study, or some combination, and each source sets its own rules.
This section groups together every form of education money you do not have to pay back. That includes federal and state grants tied to financial need, merit scholarships awarded by colleges, and private awards from foundations, employers, community groups, and professional associations. The pages here move in a logical order: understanding what an award is before you search, searching before you apply, and applying before you deal with taxes or protect yourself from scams.
The distinction between a scholarship and a grant is mostly a naming convention. Scholarships most often reward academic achievement, talent, or a particular background; grants most often reflect financial need. In practice the two overlap, and many awards use both criteria. The pages in this section treat them together where the process is the same and separately where it differs — federal grants, for instance, have their own application rules that private scholarships do not.
Work through the pages roughly in order if you are starting from scratch. If you already understand the basics and need something specific — say, awards for a particular life situation, or guidance on an essay — jump directly to that page. Every page here assumes you are looking for money you will not owe back; anything involving repayment belongs in the Student Loans section.
This section does not cover the FAFSA, Expected Family Contribution, or the broader financial aid packaging process — those live in Financial Aid & FAFSA. It also does not cover loans of any kind, which are covered in Student Loans.
What you need to understand first
Gift aid vs. self-help aid
Gift aid — scholarships and grants — does not need to be repaid and does not need to be earned through campus work. Self-help aid — loans and work-study — does. This section covers only gift aid. The difference matters because mixing them up leads students to over-borrow when free money was available first.
Need-based vs. merit-based awards
Need-based awards depend on a family's financial circumstances, usually measured through federal or institutional aid forms. Merit-based awards depend on academic record, talent, community service, or another achievement. Many awards combine both. Knowing which type you are applying for tells you what documentation to prepare and which form, if any, triggers eligibility.
Award sources and who controls the rules
Federal grants are governed by statute and administered by the Department of Education. State grants are set by each state's higher-education agency. Institutional awards are set by the college itself. Private scholarships are set by the sponsoring organization. Each source publishes its own eligibility rules, deadlines, and renewal conditions — there is no single master rulebook.
Renewable vs. one-time awards
Some awards pay out once; others renew each year provided the student meets ongoing conditions such as a minimum GPA or full-time enrollment. Whether an award renews — and what can end it — is stated in the award letter or the sponsoring organization's terms. Assuming an award renews automatically is one of the costliest mistakes students make.
How awards affect the rest of your aid
Receiving a scholarship or grant can reduce other aid in your package. Colleges are required to keep your total aid within your cost of attendance, so an outside scholarship may offset institutional aid rather than add to it. How a specific college handles outside awards varies, and their policy is worth confirming directly before you accept.
Tax treatment of scholarship money
Scholarship and grant money used for tuition and required fees is generally excluded from federal taxable income. Money used for room, board, or other expenses may be taxable. The rules depend on the type of award, how the money is used, and whether the recipient is a degree candidate. The IRS publishes the current rules; a tax professional can apply them to a specific situation.
Guides in this section
How Scholarships Work
Federal and State Grants
Finding Scholarships
Scholarship Applications and Essays
Scholarships by Student Situation
Institutional and Merit Aid
Scholarship Scams and Taxes
Mistakes to avoid with Scholarships & Grants
Applying only to large, nationally advertised scholarships
Why it happens: Big awards are heavily promoted, so they attract far more applicants and feel like the obvious place to start.
What to do instead: Search for local and niche awards first — community foundations, employers, professional associations, and identity-based organizations often have smaller applicant pools and awards that match your specific situation.
Treating a scholarship as guaranteed income after the first year
Why it happens: Award letters often do not make renewal conditions prominent, and students assume the money continues as long as they stay enrolled.
What to do instead: Read the renewal terms before accepting any award and note the specific GPA, enrollment status, or other conditions required each year to keep it.
Submitting one generic personal essay to multiple scholarships
Why it happens: Writing a single essay feels efficient when deadlines are close together.
What to do instead: Tailor each essay to the specific mission of the awarding organization — reviewers can tell when a response is generic, and a targeted essay is consistently rated higher than a polished but unspecific one.
Scholarships & Grants: common questions
Do I have to pay back a scholarship or grant?
No — that is what distinguishes them from loans. However, some awards include a service obligation, such as teaching in a high-need school district, and failing to meet that obligation can convert the award into a loan. Read the award terms carefully before accepting.
Does getting a scholarship affect my financial aid package?
It can. Colleges must keep your total aid within your cost of attendance, so an outside scholarship may reduce institutional grants or other aid rather than add to your total. The college's policy on outside awards varies by school. Confirm how a specific institution handles it before you accept an outside award.
When should I start looking for scholarships?
Many private scholarship deadlines fall in the fall and winter before the academic year you plan to attend. Some open earlier. Starting the search at least a full year before you need the money gives you the most options. Some awards are also available to current students, so searching is worth doing every year, not only before enrollment.
Do I need to fill out the FAFSA to get scholarships?
Federal and most state grants require the FAFSA. Many institutional scholarships also use FAFSA data to determine eligibility. Private scholarships from outside organizations generally set their own requirements and may not need the FAFSA at all. Check the requirements for each award individually.
Are scholarship search websites safe to use?
Reputable free search databases exist and are widely used. The warning signs of a scam are a fee to apply, a guarantee of winning, or an award you were notified about without applying. The Scholarship Scams and Taxes page in this section explains how to tell a legitimate search tool from a predatory one.
Is scholarship money taxable?
Money used for tuition and required fees at a degree-granting institution is generally not taxable under federal rules. Money used for room, board, travel, or equipment may be. The taxable portion depends on how the funds are used and the student's tax situation. The IRS publishes the current guidance, and a tax preparer can apply it to specific circumstances.
