Financial Aid - Merit-Based vs Need-Based
Financial aid is a key process in beginning the college experience. It is, in fact, almost as important as being accepting to the college of a student's choice because, these days, without the benefit of financial aid, it is well highly impossible to get through all four years of undergraduate school. Financial aid applies to the entire college experience. It is used to help students pay for tuition first and foremost, but it also aids in paying for books and lab fees, their dormitories or apartments, as well as the many and varied miscellaneous fees which often apply in college.
But that is just the beginning of understanding the purpose and benefits of financial aid, which is generally split into two different kinds of help. The first kind of financial aid is called merit-based, wherein scholarships can apply both to awards offered by individual universities and those offered by third-party organizations. Merit-based financial aid is usually offered to students who have excelled academically. Some, however, also apply to students who have excelled in some special area. Certain groups, such as the YMCA, also offer merit-based scholarships.
For example, an Honor Society student might be offered merit-based financial aid due not only to high academic standards but also because the implied prestige and merit surrounding the National Honor Society. An outstanding high school football player with good grades could also qualify for a merit-based scholarship. He does not necessarily have to have a 4.0 grade-point average - generally, a C or C+ is the minimum grade-point average - simply because he has shown a high quality of skill, responsibility, and determination as it applies to athletics. A school's best artist, then, might also receive a merit-based scholarship. Students exhibiting excellent qualities in leadership and responsibility may also qualify.
Merit-based financial aid does not focus on a student's actual financial needs. A student who comes from a well-to-do family which would not have trouble paying for college could receive a merit-based scholarship - if he or she deserved, of course - as easily as a student who must rely solely on financial aid in order to attend college.
That brings to mind the second type of financial aid: the need-based scholarship. The monetary needs of an individual student determine the awarding of need-based financial aid. In other words, while merit-based scholarships can be awarded to those who have a lot of money and those who do not, the same well-to-do student used in the above example could not receive a need-based scholarship. Need-based financial aid exists solely to help those in financial need. In most circumstances, a student's financial need is determined by FAFSA (the Free Application for Federal Student Aid), an extensive survey filled out before a student's first semester at college.
Understanding the key differences between need-based scholarships and merit-based scholarships is just the beginning when it comes to understanding the ins and outs of financial aid. However, it is incredibly vital to know the difference before beginning the process of acquiring financial aid, to better understand what the potential student will need - and, more importantly, what they will be able to receive, in terms of financial aid.
Gary Marjani is author of several articles pertaining to student financial aid such as FAFSA [http://www.studentfinaidinfo.com/faq/fafsa/info.php], Stafford Loan [http://www.studentfinaidinfo.com/faq/stafford/loan.php], Pell Grant [http://www.studentfinaidinfo.com/faq/pellgrant/info.php], etc.