When it comes to education, one of the most frequently asked questions is, “What exactly is financial aid?” One of the most common misconceptions about higher education financial aid is that funds provided by the federal government are not expected to be repaid. Given that Federal Financial Assistance is made up of four forms of aid, the theory is only partially right. It is important that both future and current university students are mindful of the differences. more about it
Loans – They must be paid back.
Grants – They don’t have to be paid back.
Scholarships do not have to be repaid.
Work-Study – Amounts and hours of federal work-study are decided by your college.
School loans, both subsidised and unsubsidized, are given funds with the promise of repayment. A PLUS loan is another type of financial aid available. In a nutshell, PLUS loans are federal loans that are often received by college or higher degree-seeking students (i.e. Doctorate individuals). PLUS loans can be taken out by parents or guardians of dependent undergraduate students (under 24 years old) to help fund school-related costs not covered by Financial Aid loans.
Scholarships and grants are not allowed to be paid back and are normally given out on the basis of “merit” (college scholarships) and/or “need” (Grant). These need-based grants, such as the PELL Grant, are intended to assist low-income or no-income families who are experiencing financial hardship and have a high reliance on additional funding to meet school expenses. Scholarships may also be dependent on financial need in some situations. Merit-based offers are usually based on a number of factors, depending on the scholarship; however, a student’s financial situation (“need”) isn’t necessarily one of them.
Federal Work-Study programmes are most likely part-time work opportunities for Professional, Undergraduate, and/or Graduate students (at least part-time) who are in financial need. Any work-study tasks are generally based on the student’s college degree and/or general public service. It’s also worth remembering that not every university or college participates in the programme, so double-check with your favourite university or college to see if this is a choice that works for you.