Financial aid is money lent or given to you to help pay for college tuition and related expenses. Financial aid can come from the state or federal government, the college you attend and other resources. Depending on the type of aid you receive, these funds can be used to cover your college tuition and fees as well as other education-related expenses like room and board or textbooks. Most full-time college students receive some kind of financial aid. To qualify for financial aid, you have to apply. Click here to read about the financial aid process.
What Types of Financial Aid Exist?
There are four main types of student aid:
Grants are a type of gift aid that does not have to be paid back. Grants come from federal and state governments and also from colleges. Grants are typically need-based. Need-based financial aid is usually given based on your family's or your financial circumstances.
Scholarships are also gifts that do not have to be paid back. Scholarships may be awarded from governments, universities and even private organizations and businesses. Most scholarships are merit-based. They may be given for academic or athletic ability, interest in a certain area, volunteer work, or even membership in ethic or religious groups. Sometimes companies will even give out scholarships to the children of their employees.
When students and their parents borrow money from a lending company, bank, or government, they are taking out a loan. Loans must be paid back with interest. The federal government offers low interest loans to students with financial need. Other lenders may be offered through your college or university.