Need-Based Scholarships

Paying for college can be stressful for many students and families, especially when financial resources are limited. However, more than $100 billion in grants and scholarships are distributed each year, with a significant portion coming from government programs. If students start early, stay organized, and take advantage of the resources available through your school’s financial aid office or other digital scholarship platforms, need-based scholarships can make a huge difference during their time at school.

In this Scholarship Institute guide, we explain what need-based scholarships are for, how to find and apply for them, and tips to win this kind of financial aid.

Looking for more resources to help pay for college? Check out our blogs at Scholarship Institute for tips on applying for need-based aid and multiple scholarships. Start your journey today!

Everything You Need to Know About Need-Based Scholarships

Thankfully, need-based scholarships are available to assist students who demonstrate financial need to pay for things such as college tuition. These scholarships aren’t awarded based on academic excellence or test scores but rather on a family’s ability (or individual) to contribute to the cost of education.

By understanding how financial need scholarships work, students can navigate the financial aid process to secure funding for their college education. Whether you are a traditional student or someone who decided to start school later on in life, there are many opportunities available to pay for your education.

Many of these need-based scholarships are also oriented to other groups such as veterans, homeschoolers, immigrants, and more.

What Are Need-Based Scholarships?

Need-based scholarships are a type of financial aid offered to students who cannot afford their expenses while studying. Unlike merit scholarships, which are awarded based on academic achievement or extracurricular activities, need-based scholarships are made to help students from low-income backgrounds cover tuition, housing, textbooks, and other expenses.

Many schools, federal grants, and private organizations offer need-based aid to ensure students’ access to higher education regardless of their financial situation. This helps bridge the gaps between what families can afford and what attending a four-year university, two-year college, or grad school actually costs.

Eligibility and Application Process

To begin with, the college’s financial aid office, the federal government, and/or the organization of specific scholarships will set a number of requirements that dictate your eligibility for need-based scholarships. Here are the steps we recommend before students begin to apply for scholarships:

Step 1: FAFSA

Most schools and scholarship programs require students to complete the Free Application for Federal Student Aid (FAFSA). The FAFSA determines a student’s Expected Family Contribution (EFC), which is used to calculate demonstrated financial need. The lower the EFC, the more likely a student is to qualify for need-based financial aid.

Step 2: Additional Documents

Students probably will need to provide proof of their family income, such as tax returns or pay stubs. Some scholarship applications may also ask for personal essays or statements, two letters of recommendation, and transcripts.

Step 3: College’s on Beyond Finances

While financial need is the primary measure, some need-based scholarships also consider other factors, such as career goals, academic excellence, or extracurricular activities.

Types of Need-Based Scholarships

There are multiple types of need-based scholarships:

1. Pell Grants

The federal government awards Federal Pell Grant to students, which is one of the most popular forms of need-based aid. It’s free money that does not need to be repaid and is available to undergraduate degree students who meet financial eligibility.

2. Institutional Scholarships

Many colleges and universities provide need-based college scholarships to students through their financial aid offices. For example, the Greenhouse Scholars Program helps students with financial needs achieve their academic and career goals.

3. Private Scholarships

Several Organizations and Foundations offer generous scholarships based on financial need. These awards are aimed at all types of students, such as high school seniors, college students, and even graduate students enrolled in advanced programs.

4. State Grants

Many states offer need-based grants to residents attending public or private institutions within the state. These grants are helpful for low-income students who plan to stay local for college and have resided for a minimum period of time in one state.

Federal Student Aid and Need-Based Scholarships

The federal government is the major figure responsible for providing financial support to students with financial needs. By filling out the FAFSA form, the government is able to recognize the financial need of students and families and helps supporting with programs like the Pell Grant, work-study, and federal loans. These can be combined with need-based scholarships from other sources to cover the total cost of attendance.

• FAFSA Submission: Completing the FAFSA form is the first step to determining eligibility for federal student aid programs.
• Federal Pell Grant: The government offers thousands of dollars annually to students pursuing their first undergraduate degree.  
• Work-Study Programs: These are a great opportunity for students who need additional help. Work-study allows students to make money by working part-time on campus, helping with the cost of school, and gaining professional experience.

External Sources of Need-Based Aid

Besides institutional and federal aid, many private organizations offer need-based scholarships to high school students, college students, and graduate students:

• Bold.org and Tallo: These platforms supply scholarships to students based on financial need, specific talents, or academic excellence. They make the application process simpler and more effective than trying to find individual scholarships. Bold.org offers the opportunity to apply for multiple scholarships with a few steps and has multiple no-essay scholarships available to all kinds of students.
• State Programs: Some states offer tuition waivers, grants, and need-based financial aid for residents attending public universities. For example, states like California offer free tuition to low-income students in community colleges.
• International Students: Some programs also provide help to international students who can demonstrate financial need, though these opportunities can be more competitive and vary depending on the institution and state.

Maximizing Your Chances of Winning a Need-Based Scholarship

To secure need-based financial aid, we recommend following these tips:  

1. Start Early: If you are a high school senior, you should begin the scholarship search in the fall semester and prioritize submitting the FAFSA as soon as possible. Submitting these forms as soon as possible is also highly recommended to college or grad students since some of the funding is distributed early, and being late may cause them to lose some funding.
2. Be Thorough: Complete the scholarship application with attention to detail and include all required documents, such as essays, transcripts, or letters of recommendation.
3. Apply to Multiple Scholarships: Don’t limit yourself to just one scholarship. Many scholarships have overlapping eligibility criteria, so applying to several can maximize your chances of receiving funding.
4. Tell Your Story: In essays, explain how your financial background has shaped your goals and how the scholarship will help you succeed.

Frequently Asked Questions: Need-Based Scholarships

If you still have questions that we may have not covered, check out the following Q&A:

1. How Do International Students Demonstrate Financial Need, and What Specific Need-Based Scholarships Are Available to Them?

International students can demonstrate financial need by submitting detailed documentation of their family’s income and expenses. While they may not qualify for FAFSA, some colleges have their financial aid forms for international applicants. Schools like Yale or Harvard offer need-blind admission for international students, and programs like the Davis United World College Scholars Program or private scholarships listed on platforms like Bold.org often provide need-based funding. These opportunities are limited and competitive, so international students need to apply early and make sure to provide clear, accurate financial documentation.

2. Are There Need-Based Scholarships That Do Not Require FAFSA, Especially for Students Who Are Undocumented or Ineligible for Federal Student Aid?

Yes, some scholarships don’t require FAFSA. Many private organizations and state-funded programs provide need-based scholarships for undocumented students or those who can’t complete FAFSA. For example, States like California offer programs like the California Dream Act, which allows undocumented students to qualify for state financial aid.

3. Can Need-Based Scholarships Be Combined with Merit-Based Scholarships, and Is There a Limit to How Much Financial Aid a Student Can Receive?

Yes, most need-based scholarships can be combined with merit-based scholarships. Many colleges use a “stacking” method, where students can receive multiple awards to cover tuition, housing, and other expenses. However, some schools may have a cap on total financial aid that students can receive, often limited to the cost of attendance, and may readjust your package of financial assistance if a student wins multiple scholarships. Check with your college’s financial aid office to see if combining aid is allowed and how it will impact your overall award package.

4. What Happens if a Student’s Financial Situation Changes Mid-Year? Can They Qualify for More Need-Based Aid after the Fall Semester?

If a student’s financial situation changes—such as a parent losing a job or a medical emergency—they can submit an appeal to their school’s financial aid office for reconsideration and financial adjustment. Most schools allow students to provide updated financial documents to adjust their Expected Family Contribution (EFC). This process is called a Special Circumstances Appeal, and it could qualify the student for additional need-based financial aid, including grants or work-study opportunities, even after the fall semester.

5. What Documentation Is Required by Most Schools to Determine Eligibility for Need-Based Aid?

In addition to the FAFSA form, most schools require documentation such as recent tax returns or W-2 forms from the student’s parents or guardians; proof of household income, like pay stubs; statements for any savings or investment accounts; non-taxable income information, such as child support or disability benefits. Some private scholarships may also ask for essays, letters of recommendation, and evidence of financial hardship, like a personal statement explaining your situation.

Ready to explore need-based scholarships and start funding your education? Visit Scholarship Institute and find multiple resources to apply for legit scholarships.