I received a good question from a parent during my last Smart Money Moves™ Webinar, so I wanted to address it on the blog:
“With the recent D.O.E. news, federal aid is not certain, how certain are the scholarships each school is offering? We don’t want to make a decision if the financial aid won’t be there for future years, and then we have to take our child out of school.”
In short, scholarships likely will not be majorly affected. Scholarships offered directly by colleges and universities are generally more stable than federal financial aid because they are funded by the institution itself or private donors. However, their certainty depends on a few key factors:
- Institutional Budgets – If a school relies heavily on federal funding and experiences budget cuts due to changes in Department of Education policies, it could impact their ability to offer as many scholarships in the future.
- Endowment and Donor-Funded Scholarships – Many scholarships come from university endowments or private donors, making them more insulated from federal aid uncertainty. However, economic conditions can still impact donor contributions.
- Merit vs. Need-Based Aid – Merit scholarships are usually locked in when awarded, while need-based institutional aid could fluctuate if your financial situation changes (which might be affected by federal aid reductions).
- Renewability and Conditions – If you or someone you know is receiving a scholarship, check whether it’s renewable each year and what conditions (GPA, enrollment status, etc.) must be met.
If federal aid becomes uncertain, schools may need to adjust their financial aid strategies. But scholarships already awarded for the upcoming academic year are generally safe. It’s always a good idea to confirm with the financial aid office at the school in question.
I created a checklist of what questions your family should ask when looking at financial aid and scholarships in the coming year. DOWNLOAD IT HERE!
I hope you find all of this information useful, and if you have further questions, please give The Capstone Team a shout.
(Parts of this post were written with assistance by ChatGPT)
