Two of the most common forms of financial aid for college are scholarships and federal financial aid.


Most colleges offer scholarships to their students to help with the cost of the college education. These are usually awarded based on a combination of scholarship, community involvement, college entrance test scores, and financial need.

When comparing the cost of similar colleges, the student and parents should not only look at the costs of the college (tuition, room, and board, student fees) but also the scholarships available to the student.

Students should apply for every scholarship they are eligible for, not just those offered by the college. For instance, many local organizations offer scholarships through the high schools. There are also numerous scholarships available through other organizations such as veterans groups, ethnic groups, Boy Scouts/Girl Scouts, and religious organizations. Every scholarship awarded reduces the college cost dollar for dollar.

Federal financial aid

Most federal aid is need-based. Grants usually do not have to be repaid. Loans, however, accrue interest and have to be repaid.

Subsidized loans do not accrue interest while the student is in college, but unsubsidized loans do accrue interest during the time the student is in college. Thus, with an unsubsidized loan, at graduation the student will owe the amount borrowed plus interest.

Loans are also available for parents and for graduate students.

Part 1: Minimizing the cost of college

Next week: Part 3: Ways to reduce student loan debt


Judith Ackland has more than 26 years of experience in accountancy and financial planning, including seventeen years as a CFO of a diverse business. She started Crystal Financial in 2010 to help a wide array of individuals, families, and business owners better understand their finances and how good financial management could help them achieve their goals. Judith has an MA in Professional Accountancy from the University of Nebraska at Lincoln as well as a Certified Public Accountant Certificate and a Certified Financial Planner designation.

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