Know The Difference Between Grants and Scholarships Before You Apply

Difference between grants and scholorships

For some students, access to financial aid can make the difference between being able to attend college or not. For plenty of others, getting help with college tuition can still provide a huge relief, given the rising costs of higher education and the pinch many of us feel on our monthly budgets. Regardless of where you fall on the spectrum, understanding the types of financial aid available is critical in navigating the complexities of getting help paying for school.

Grants and scholarships are similar in that, unlike loans, they do not need to be repaid. For this reason, they are often referred to as "gift aid," and as far as student financial aid goes, they tend to be the most appealing. But before you start applying for every grant and scholarship you can find, it's important to understand how they differ.


A tuition grant is typically need-based, meaning it is awarded with a person's financial situation in mind. Grants can come from a number of sources, including governments, individual colleges, and private institutions.

Federal grants are offered by the US Department of Education and include Pell Grants, grants for military veterans and more. In order to see if you're eligible for a federal grant, you'll first need to complete the Free Application for Federal Student Aid (FAFSA). This questionnaire is used to evaluate you or your family's finances, since Pell Grant awards and other forms of federal aid (such as loans) are scaled based on need.

You might periodically come across other types of grants, including those given out to fund a specific activity, such as a research project. Students applying for this kind of grant might, for example, coordinate with a sponsoring faculty member to submit their application.


Unlike grants, which for students entering school tend to be need-based, scholarships are often merit-based. In other words, the recipient will have earned the scholarship based on meeting some achievement qualification, such as top-of-the-class honors in high school, or musical or athletic ability.

There can also be scholarships where membership in a certain group (for example, gender or ethnic background) may be a baseline criterion in addition to other forms of evaluation. Or, scholarships can be made available to students who plan to pursue a particular career path.

Maintaining Eligibility

In the case of both grants and scholarships, it's important to know that there may often be certain qualifications that a student has to meet on an ongoing basis in order to keep the award. A minimum GPA, for example, is a typical requirement. In the case of Pell Grants (as is true of all forms of federal aid), students need to reapply for each school year, which means the amount awarded, if any, could change if the student's financial situation has also changed.

Knowing the differences between grants and scholarships is an important first step in knowing where to look for financial aid. Doing your research ahead of time will improve your chances of getting the help you need to achieve your degree.

Written by Ashford University staff.

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