How Does a College Scholarship Work?

What Is a college scholarship?

A college scholarship is a grant of money given to a student that covers some or all of the expenses involved with higher education. (A grant is "free money" that does not need to be repaid.) A scholarship can come from many different places: schools themselves usually maintain a budget to offer promising incoming students scholarships as incentive to attend their school, many companies sponsor scholarships to students who they feel exhibit their core values, and special interest groups often create scholarships for students that meet certain criteria, such as a certain amount of community service. Some scholarships must be applied for, while oftentimes a school will consider a student for scholarships automatically if they apply to the school. Competition for certain scholarships can be fierce, and some are granted as the result of essay-based contents. There are two general categories that all scholarships fall into: scholarships based on the abilities of the student and scholarships based on factors that the student cannot control.

Academic-Based Scholarships

Ability-based scholarships are awarded to students for displaying outstanding achievement in academics or athletics. Students are often automatically considered for academic scholarships to all the schools they apply to. Scholarships for sports can sometimes be negotiable for very skilled athletes attending large schools. ability-based scholarships usually require a student to maintain a certain level of performance to keep their scholarship money, and many scholarships grant a certain amount of money per year instead of one lump sum, so students need to maintain a certain GPA in order to qualify for the scholarship in the next semester. Sports-based scholarships require the student to continue to participate in the sport for the scholarship to be renewed.

Need-Based Scholarships

Need-based scholarships are those given to students who do not necessarily earn them based on performance or merit. Since higher education is very expensive, students coming from less affluent families can often receive grants simply due to their economic circumstances.
Demographic scholarships award money to students that meet specific criteria, usually revolving around race, gender or public service. These scholarships are often created by special interest groups or wealthy individuals who decide to set up scholarships funds to assist students that would normally have difficulty attending college, such as students who are the first in their family to attend college.