After Winning a Scholarship, You Need to Keep ItPosted by
Scholarship Displacement: After Winning a Scholarship, You Need to Keep It
Scholarships are a crucial part of college financial planning. However, just because you're awarded a scholarship doesn't mean you're guaranteed it. Below, you'll find tips on how to keep your scholarships. You'll also find some helpful info on what exactly scholarship displacement is and what you can to avoid it.
Tuition costs have doubled in the past three decades, and student loan debt has increased along with it. Since financial need has surged there is a huge emphasis on winning scholarships. Students spend months, even years, searching for scholarships, applying for scholarships and hoping to win them in order to make college more affordable. While winning scholarships is an essential part of the college application process, there is not enough emphasis on the equally crucial aspect of keeping scholarships.
What to Do After Winning a Scholarship:
Students should keep a spreadsheet of all of their scholarships so that they know exactly how much money they will receive every term. Since scholarship providers may work with many different colleges, a proactive practice for students is to email the scholarship provider with their college’s tuition deadline and mailing address so that the provider can ensure the check is sent prior to the cut-off.
Some scholarships are non-renewable, which means that they do not extend past the first year. This can happen with freshman-only scholarships where a college will offer an extra generous financial aid package to entice more students to enroll, and then offer a less generous package in subsequent years. Students should ask if a scholarship is renewable.
The next piece to consider is: what is required to keep the scholarship? Scholarships come from many sources and each individual scholarship may have different stipulations for their students to maintain their scholarship. Common requirements for scholars are grades, major, communication expectations, and in-person obligations.
Students should be wary of scholarships requiring them to maintain a high GPA in order to keep their funding. The average college GPA is below a 3.5 and it can be difficult to maintain a high GPA throughout the entire time in college. If a scholarship requires a student to maintain a 3.5, then the student needs to treat their GPA like a second job and prioritize keeping their grades up. Students should inquire if the scholarship has a probationary period for them to raise their GPA prior to dropping students who fail to make grades. If there is no probationary period, that could translate into a student losing a scholarship mid-year, which gives them little time to come up with the funds to cover what the scholarship would have.
STEM-specific scholarships are on the rise, as well as other scholarships that are tied to the major a student is studying. These scholarships can be great because they will attract a smaller applicant pool of eligible students. However, for students who are in majors that end up not being the right fit for them they may be at risk of losing out on scholarship dollars once they change majors.
Many outside scholarships have touchpoints or reciprocal communication expectations with their scholars to be considered “in good standing” and eligible to continue receiving the scholarship. These requirements can vary from a call once per term, to monthly and even weekly communication expectations. There is usually a document submission requirement, like submitting a transcript or class schedule but sometimes students will be expected to send progress reports, financial documents and may even need to write essays to the scholarship provider. If the scholarship provider has mandatory in-person events, the recipient should make sure to include that expectation in their calendar, and let bosses or study groups know that they are not available on certain dates.
Lastly, scholarship recipients should be aware of scholarship displacement, also known as award displacement. Scholarship displacement is when one form of financial aid, like a university grant is reduced or canceled when a student receives another form of financial aid, like an outside scholarship. Students work very hard to gain enough scholarships to cover their full cost of attendance, and it can be disappointing and frustrating when they find out that some of their awards were displaced.
Colleges cannot accept more aid than the student’s Cost of Attendance, so the stories about students who won a million dollars in scholarships can be quite misleading. Most need-based aid can only cover the Cost of Attendance – Expected Family Contribution. Outside scholarships can cover EFC but some colleges have a Minimum Student Contribution requirement.
Students can check if their college has an outside scholarship policy on their school's website.
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