How to Find Scholarships to Pay for College

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Whether you're preparing for your first year of college or you're almost ready to graduate, applying for scholarships is a crucial step in reducing your reliance on student loans when covering your educational expenses.

There are a few different ways you can find scholarships. It can take time and work to track down and submit applications, but your efforts could pay off with lower college costs and less student loan debt. Here are some tips to help you maximize your chances of getting free money to help pay for school.

Types of Scholarships for College

There are several categories of scholarships that may be available to you, depending on your situation. Here's how each works and where you can get them.

  • Need-based scholarships: You may qualify for one of these scholarships if you can demonstrate financial need, regardless of other factors. They're commonly awarded to students who come from low-income households.
  • Merit-based scholarships: These are typically tied to your academic, athletic or artistic performance. Some merit scholarships also factor in your financial need.
  • State-based scholarships: Some scholarships are offered only to students who live in certain states. Depending on the offer, you may be able to receive one from the state or a private organization that operates in the state.
  • Community service scholarships: If you spend a lot of time serving your community, there may be scholarships in your area available to reward you for making your community a better place.
  • Military scholarships: Each branch of the Armed Forces offers scholarships for service members, veterans and even their families.
  • Demographic-based scholarships: Some scholarships are designed specifically for students based on their heritage, gender, orientation and more.
  • Unusual scholarships: If you have an unusual hobby or skill, there may be a scholarship out there that rewards it. For example, a town in Arkansas hosts a duck calling contest every year and awards the winner with a scholarship. You may also be able to get scholarships for speaking a constructed language like Klingon, working as a golf caddy and more.

Where to Look for Scholarships

You'll typically want to begin your scholarship search with your college or university, then also look into other organizations. Here are some places you can start:

  • Your college's financial aid website, and more specifically your individual major or concentration
  • Your high school (if you are a junior or senior)
  • U.S. Department of Labor's scholarship search tool
  • Federal and state agencies
  • Military recruitment offices
  • Local religious and community organizations and businesses
  • Associations related to your area of study
  • Ethnicity-based organizations
  • Fastweb
  • CollegeBoard
  • Sallie Mae
  • Chegg
  • Cappex

Make Sure You Fill Out Your FAFSA

The Free Application for Federal Student Aid (FAFSA) isn't typically required for scholarships awarded by private organizations. But if you want to receive financial aid through your college or university, you'll need to fill out that application.

The FAFSA is also required for other forms of federal student aid, such as grants, work-study programs and even student loans. It may also be compulsory if you want access to state-based aid, such as the Cal Grant offered to students living in California.

As such, it's critical that you complete the FAFSA each year before the deadline, which is usually the end of June.

How to Get Student Loans if You Need Them

Even after valiant efforts to get scholarships and pursue other ways to avoid student loans, you may still fall short. If this happens, you may choose to borrow money to cover your remaining expenses. While it's not ideal, it's preferable to ending your education, and there are some steps you can take now to avoid paying more in the future.

For starters, it's almost always a better idea to borrow using federal student loans instead of private student loans. Even if you can get a lower interest rate on a private loan, federal loans come with several perks, including:

  • Student loan forgiveness programs
  • Loan repayment assistance programs through federal agencies
  • Income-driven repayment plans
  • Generous deferment and forbearance options

You may also qualify for other benefits as a federal loan borrower. One big example is the moratorium on student loan payments and interest put in place by the Department of Education and later legislation in response to the coronavirus pandemic. Another is the potential of federal student loan forgiveness by executive order, which has been floated as something that may happen in the future under President Biden.

All things considered, unless you're confident you won't need any of these perks and you have excellent credit and a solid income, you're likely better off with federal loans.

If you're planning to borrow money to pay for school, here are some things you can do to limit the burden:

  • Fill out the FAFSA to see if you qualify for subsidized loans, which don't accrue interest while you're in school.
  • If you don't qualify for subsidized loans, consider making interest-only payments while you're in college to avoid having the interest capitalized, or added to your original balance, upon graduation.
  • Choose an inexpensive school to begin with, or transfer to one if you're already in college and need a less expensive option.
  • Create a budget to control how much you spend every month.
  • Avoid borrowing more money than you need.
  • Look for other ways to avoid student loans, such as working part or full time and applying for grants.

Don't Be Discouraged

Searching and applying for scholarships can be time-consuming, and you may feel discouraged from the get-go because you're competing with other students.

But while you'll likely need to apply for a lot of scholarships to be awarded one or two, the extra effort can ultimately save you thousands of dollars in the long run. With the average individual student loan balance reaching $38,792 in 2020, according to Experian data, any money you can save now can have a huge impact on your finances once you graduate.

It's also important to note that scholarships are often poorly advertised, which means some don't have nearly as much competition as others. If a scholarship's requirements seem strict, apply anyway. After all, you might end up being the only one who applies—especially if the scholarship was hard to find, or is open to a limited group of students (students in a particular college program, for instance). Many scholarship websites list thousands of opportunities, so you're bound to find some that you qualify for and can win.

Take Time During College to Build Your Credit for the Future

You may or may not need to have a good credit score when you're in college. But when you graduate and want to purchase a home or a car, having good credit can make it easier to get approved and save you money through lower interest rates.

So while you're in college, consider taking some steps to build your credit. This can include making those interest-only payments on your student loans or opening a student credit card and using it then paying off the balance in full each month. If you end up taking out student loans, repaying them can be a great way to build credit.

It's also a good idea to check your credit score and credit reports regularly to understand how your actions impact your credit and what you can do to address potential issues as they arise.