Is it true that there are billions of dollars in unclaimed scholarships each year? How can my son get his share?
The claim that billions of dollars of scholarships go unclaimed each year is a myth.
The unclaimed aid myth is based on a 1976-77 academic year study by the National Institute of Work and Learning, which estimated that $7 billion in employer-paid tuition assistance was available each year, but only $300 million to $400 million was used annually. Subtract one figure from the other to arrive at $6.6 billion that was subsequently misreported as unclaimed scholarships. Thus, the myth is more than 30 years old, was based on an unsubstantiated estimate and had nothing to do with private scholarships.
The unclaimed aid myth and several variations were often promoted by fee-based scholarship search services, to convince students to pay money to claim their share of this money. Many of these fee-based services stopped using the unclaimed aid myth after a judge ruled that the use of the unclaimed aid myth was on its face fraudulent. Other fee-based services shut down after the creation of free online scholarship matching services in the mid-1980s.
Millions of students search for scholarships annually on free scholarship matching services like StudentScholarshipSearch.com. When scholarships are listed in these databases, they usually get many more qualified applicants than they have funds available.
The only scholarships that ever go unclaimed are scholarships with very restrictive selection criteria that match very few students. For example, the Zolp scholarship at Loyola University in Chicago is for a student born with a last name of Zolp. The name must appear on the student’s birth certificate and christening certificate. Most years they have one or two students receiving the scholarship, but some years they have none. You cannot change your name to qualify.
Another example is the Malcolm R. Stacey Memorial Scholarship at the University of California at San Diego. This scholarship was restricted to Jewish orphans seeking a graduate degree in aeronautical engineering. It went unclaimed for many years until the university obtained a court order in 1987 to relax the restrictions.
There is, however, one form of financial aid that sometimes goes unclaimed, and that is the Federal Pell Grant. In 2011-12, an estimated 2.0 million students would have qualified for the Federal Pell Grant if only they had applied by filing the FAFSA (Free Application for Federal Student Aid). Of these, 1.3 million would have qualified for the maximum Federal Pell Grant. These students are leaving thousands of dollars on the table.
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