While you’re applying to financial aid, you may come across need-based and merit-based aid. What do those two terms mean though? Need-based aid is awarded on the basis of financial need. Students can (and should) file the FAFSA to discover need-based award opportunities. Those come in the forms of scholarships, grants, work studies, and loans. Merit-based aid, on the other hand, is awarded on merit alone. That includes impressive grades, athletic prowess, a certain achievement, being a certain race/religion, etc.
Now you know what both of those terms mean. But can a student earn both merit- and need-based aid?
Short answer: yes! You can get merit- and need-based aid.
Just because a student needs a little extra financial help to pay for their education, doesn’t mean they can’t excel at academics, sports, or community involvement after all. The two don’t necessarily correlate. So a student could potentially have a need-based federal government scholarship, and also earn a private scholarship for being an amazing swimmer. In other words, you can absolutely get both types of aid.
Slightly longer answer: Yes, but one affects the other…
If only it were as simple as “yes”. While a student can indeed have both merit- and need-based aid, earning merit-based aid can potentially lower the amount of money they could receive from their need-aid provider.
Essentially, by earning a private merit-aid award, they have less financial need than before—therefore, they may not get as much money from their need-based aid. In other words, a merit-aid award technically lowers your financial need, so you won’t get as much need-based aid.
That’s not a bad thing.
It’s not necessarily a bad thing, however; the student did earn some extra aid, after all. Any amount of aid money means you can take out fewer student loans (if you end up taking out student loans). Different need-aid providers—such as the federal government or the college itself—will have different ways of calculating how much aid they’re willing to give a student. Earning a private scholarship will reduce need, so some colleges/government programs will, in turn, reduce the aid provided. It all depends on your financial situation and what awards you’ve earned.
Some need-based aid programs (for example, the Pell Grant) consider themselves to be the first form of aid a student receives. Therefore, they WILL NOT reduce the amount of aid to a student, even if they earn a slew of merit-based scholarships.
So be sure to check the requirements and fine-print of your aid opportunities to see how one can affect another! You never know what affects what. And again, file the FAFSA so that you’re eligible for both merit- and need-based aid! Even if you don’t think you qualify for any aid, file it anyway. There’s no harm, and you don’t know what sort of awards you’re missing out on if you don’t.
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| Lender | Rates (APR) | Eligibility | |
|---|---|---|---|
 |
5.50%-16.12%* Variable
3.99%-15.61%* Fixed
|
Undergraduate and Graduate
|
VISIT CITIZENS |
|
|
5.54% - 15.70% Variable
3.99% - 15.49% Fixed
|
Undergraduate and Graduate
|
VISIT SALLIE MAE |
 |
5.00% - 17.99% Variable
3.49% - 17.99% Fixed
|
Undergraduate and Graduate
|
VISIT CREDIBLE |
 |
6.00% - 13.75% Variable
3.99% - 13.75% Fixed
|
Undergraduate and Graduate
|
VISIT LENDKEY |
 |
5.66% - 14.72% Variable
3.69% - 14.56% Fixed
|
Undergraduate and Graduate
|
VISIT ASCENT |
 |
3.70% - 8.75% Fixed
|
Undergraduate and Graduate
|
VISIT ISL |
 |
5.62% - 16.85% Variable
3.69% - 16.49% Fixed
|
Undergraduate and Graduate
|
VISIT EARNEST |
 |
5.00% - 14.22% Variable
3.69% - 14.22% Fixed
|
Undergraduate and Graduate
|
VISIT ELFI |
