I‘ve decided upon the college I plan to attend next fall. Last week, I learned that I have been selected to receive a $2,000 scholarship from a local scholarship competition I entered earlier this year. My excitement about this extra $2,000 was squelched when I told the Financial Aid Office at the college I plan to attend about the private scholarship. They told me that they would have to adjust the financial aid they offered me when I was accepted to the college. What should I do? Do I have any options?
All colleges must adjust the need-based financial aid package when a student wins a private scholarship. But, each college can choose how to adjust the financial aid package. Some colleges will use the private scholarship to reduce or eliminate unmet financial need, if any. Then, some colleges will use the private scholarships to reduce loans and/or student employment, in which case the student’s net price (the difference between the college’s annual total cost of attendance and all grants, scholarships and other gift aid) will decrease. Other colleges will use the private scholarship to reduce the college’s own grant funds, in which case the student gets no net financial benefit. Students should ask each college for a copy of its “outside scholarship policy” if they’ve won private scholarships. It can make a big difference in the net price to the student and his or her family.
For more details about how scholarship displacement works and possible strategies to consider, check out: https://www.edvisors.com/scholarships/win-scholarships/scholarship-displacement/
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