Types of Financial Aid to Know for College Process

Understanding the different types of financial aid is crucial for navigating college costs. From grants that don’t need to be repaid to loans and work-study options, knowing your choices can help ease the financial burden of higher education.

1. Federal Pell Grants

   • Need-based grants awarded to undergraduate students who demonstrate financial need.
   • Do not require repayment, making them a form of gift aid.
   • Award amounts vary based on financial need, cost of attendance, and enrollment status.

2. Federal Direct Subsidized Loans

   • Loans available to undergraduate students with demonstrated financial need.
   • The government pays the interest while the student is in school at least half-time.
   • Repayment begins six months after graduation or dropping below half-time enrollment.

3. Federal Direct Unsubsidized Loans

   • Loans available to both undergraduate and graduate students regardless of financial need.
   • Interest accrues while the student is in school, and the borrower is responsible for all interest.
   • Repayment begins six months after graduation or dropping below half-time enrollment.

4. Federal Work-Study Program

   • Provides part-time job opportunities for students with financial need to help pay for education expenses.
   • Jobs can be on or off-campus and are often related to the student’s field of study.
   • Earnings are paid directly to the student, helping to cover living expenses.

5. Federal Supplemental Educational Opportunity Grant (FSEOG)

   • Need-based grant for undergraduate students with exceptional financial need.
   • Schools administer the funds, and not all schools participate in the program.
   • Does not require repayment, making it a form of gift aid.

6. State Grants

   • Financial aid provided by state governments to residents attending college.
   • Eligibility and award amounts vary by state and may be based on financial need or academic merit.
   • Often requires completion of the FAFSA and state-specific applications.

7. Institutional Scholarships

   • Scholarships offered by colleges and universities to attract and support students.
   • Can be based on academic merit, financial need, or specific talents and achievements.
   • May have specific eligibility criteria and application processes.

8. Private Scholarships

   • Scholarships funded by private organizations, businesses, or individuals.
   • Vary widely in eligibility requirements, award amounts, and application processes.
   • Can be based on academic achievement, community service, or specific demographics.

9. Merit-Based Aid

   • Financial aid awarded based on a student's academic, artistic, or athletic achievements.
   • Does not consider financial need; often includes scholarships and awards.
   • Can significantly reduce the cost of attendance for high-achieving students.

10. Need-Based Aid

    • Financial aid awarded based on a student's financial situation and need for assistance.
    • Includes grants, loans, and work-study programs.
    • Requires the completion of the FAFSA and may involve additional documentation to determine eligibility.