Introduction:

When planning for college, one of the biggest questions students and families face is how to pay for it. The good news? You don’t always have to rely on loans.

Scholarships and grants are two popular forms of free financial aid; meaning you usually don’t have to pay them back. But what’s the difference between scholarships and grants? While they may seem similar, they serve different purposes and are awarded in different ways.

 

In this guide, we’ll break it all down so you can confidently navigate your financial aid options.

What Is the Main Difference Between Scholarships and Grants?

At a glance:

– Scholarships are typically merit-based, awarded for academic achievements, talents, or extracurriculars.
– Grants are generally need-based, offered to students who demonstrate financial hardship.

Let’s dive deeper into what sets these two apart.

Scholarships: Earned Through Merit.

Yes! Many students receive both forms of aid. It’s not either/or. Combining scholarships, grants, and student-friendly budgeting tools can significantly reduce your tuition burden.

Do I have to repay scholarships or grants?

In most cases, no. However, if you withdraw from school, drop below required credits, or violate terms, you might be asked to return some or all of the funds.

How to tell the difference between scholarships and grants for college funding

When looking at college aid, a simple way to tell the difference between scholarships and grants is by how they’re awarded:

– If it’s based on performance or achievements: it’s a scholarship.
– If it’s based on your financial status; it’s a grant.

You can find out which ones you’re eligible for by checking with your school’s financial aid office or using student aid portals.

Which Should You Focus On: Scholarships or Grants?

Honestly? Both.

– Apply for scholarships that match your strengths, passions, or field of study.
– Submit FAFSA or other financial aid forms to access grants (especially in the U.S. and many other countries).

Scholarships:

Rewards academic excellence, leadership, athletic ability, artistic skills, or community involvement.

They’re funded by:

• Colleges and universities
• Private organizations
• Nonprofits
•  Corporations

Key features:

– Often require an application, recommendation letter, and essay

– Competitive and selective

– Can be renewable annually

– May be restricted to specific majors or demographics

You can check this article on how to write a recommendation letter.

Grants: Based on Financial Need

Grants are primarily awarded based on your financial situation.

They are often funded by:

– Federal or state governments
– Colleges or universities
– NGOs or education-focused institution

Common grant types:

– Federal Pell Grant (USA)
– State education grants
– Institutional need-based grants

Unlike scholarships, most grants don’t require outstanding grades or essays—just proof of financial need.

People Also Ask:

Are scholarships better than grants?

Not necessarily. Scholarships recognize achievement, while grants provide access to those in financial need. The best option depends on your circumstances—and many students qualify for both.

Can I get both a scholarship and a grant?

Most successful students combine both to maximize their tuition coverage. Be strategic and start your applications early.

Conclusion: Understanding the Difference Between Scholarships and Grants

Knowing the difference between scholarships and grants can help you make smarter decisions about how to fund your education.

While scholarships reward your hard work and talents, grants support you when money is tight. Together, they form a powerful combo for reducing the cost of higher education; without falling into debt.