College students can lose out on financial aid if they supplement tuition with private donations.
https://www.nytimes.com/2017/11/07/opinion/private-scholarship-displacement.html
I received multiple private scholarships that did not affect other aid. I got a merit based scholarship from my school and a merit based scholarship from the state. My private scholarships were also merit based, so these might be different than need based. Usually with private scholarships, they ask the institution to refrain from reducing other means of financial aid. They allow their money to be used for books and room and board after tuition has been paid off. Look at the conditions of the aid you are worried about losing. Good luck!
However the monies from the room and board is still taxable income
The scholarship granted can ask for anything they want. The school is follow the policy that it has established for outside scholarship
As long as the outside awards are for more than the need based aid, he’ll still come out ahead. He could also try for scholarships targeted to books, or study abroad.
For the first time, my daughter received more in outside aid and the school reduced one of her awards. The outside awards were for tuition only, so the school moved other awards around until everything was covered. The school had to pay less out of its own funds because of the outside award. D did not have to pay more.
Some colleges allow outside scholarships to replace loans and expected student work before reducing need-based financial aid grants. For example:
https://financialaid.stanford.edu/aid/outside/
Unfortunately, many colleges do not clearly state their policies on their web sites.
Ned based financial aid and merit aid rarely stack, even if institutional merit. As @ucbalumnus stated, some schools let the money cover student expectation or loans before reducing grants. Harvard does. Regardless, the student is no worse off.
Scholarships received reduce need. Need based aid is based on - need. We ran into this with my kid. But fortunately for her the school reduced loans before grants.
That’s nice for,YOU…but please…don’t make it sound like stacking all of these outside scholarships with need based aid is allowed at ALL colleges…because that is not true.
Actually, the %age of colleges that allow stacking of all awards is far smaller than the %age Of schools where your need will be reduced by outside awards…and your Need based aid reduced.
I’m slow in the math department, honestly. My work offers a scholarship. We won’t qualify for need-based aid. Might get some merit aid, depending on the school. Generally speaking, would getting the work scholarship negatively affect her? We aren’t aiming for CSS schools or anything top-tier.
We’ve not experienced this with S15 as his state school offers no grants, nor does our state offer any state aid.
But on a very small scale, we have felt that disappointment.
Kid is on a merit scholarship for tuition. He’s been offered departmental scholarships that cover fees and books but mean nothing to the pocketbook – those scholarships cover QEE expenses that we can claim with AOTC. It ends up being a wash. What would really help would be for those smaller $1000/$2000 scholarships to go towards room and board.
@Gatormama I don’t think so.
Bgbg4us, getting acual money is always going to be better than taking a tax creditor at least a wash. It’s not going to be worse.
Many students don’t get need based aid so the outside scholaships help a lot. I get what the author of the article says, that it may be a wash so not worth the effort to apply for the scholarship and that may be true, but how do you know when the scholarship applications are due that you’ll get so much in need based aid, that the school won’t stack, that it will be a wash? Usually scholaship applications are submitted at the same time as college apps,asfafsa, as css.
Also, if given the choice and it is a was, I’d take the merit money. It might be a named award you can add to your resume. Stamps scholarship? Society of Women Engineers? Daniels scholarship Recipient? Sounds good and the student feels he earned the money.