Types of Financial Aid Programs

Financial aid is a general term that refers to all types of financial assistance available for college financing. Financial aid is available from many different sources and there are three main types of aid—Gift Aid, Work, and Loans.

Sources of Aid

1)      Federal Financial Aid Programs—U. S. Department of Education

2)      State Aid Programs—Department of Education in your state of residence (programs vary among states). See the NASFAA site for a List of State Grant Programs

3)      Educational Institutions—Many colleges, universities, professional, graduate, proprietary and trade schools offer financial aid.

4)      Outside Scholarships—Many private companies, civic organizations, businesses, foundations, and agencies have scholarship monies available.

5)      Employers—Some employers have tuition assistance and/or benefits available. An employer’s Human Resource Department should be an excellent resource for this information.

6)      Military—Each branch of the military offers scholarship programs of some kind that are available for education.

Types of Aid

Gift Aid

This is the best stuff! As the name indicates, this is free money and it comes in the form of grants and scholarships. As the term suggests, gift aid is for the student to use toward educational expenses and it does not need to be repaid. However, a student may need to maintain a certain grade point average (GPA) to continue receiving gift aid.

Gift aid can be further broken down into two categories which includes Need Based Aid and Merit Based Aid.

Need Based Aid

Need Based Aid is awarded based on a family’s demonstrated financial need, as determined by information provided during the financial aid process. Need based aid includes grants, work and loan programs. All federal aid sources and the majority of state and college aid is need based.

Merit Based Aid

Merit based aid, or recruitment scholarships, are available directly from colleges and typically are awarded to a student based on a special talent, such as athletic or academic achievement, or for a special skill or aptitude. Recipients of merit based aid are determined based on their relative strengths against other applicants and typically are selected through the admissions application process. Usually there is no separate application required, but please be sure to check the college’s website for information on any available merit scholarship offering.

Check out each of the articles below which will share greater details on each type of financial aid program available:

Grants and Scholarships (Gift Aid)

Federal Work Study Program

Student and Parent Loan Programs

For information on the college financing process from beginning to end, check out Financial Aid Sense! Don’t miss out on financial aid opportunities – pick up a copy of this newly updated financial aid publication!

"Financial Aid Resource Book"

 

Jan Marie Combs, EzineArticles Basic Author