Need some advice re: college scholarships

[lucyanna girl]

My daughter and her long-time boyfriend just called asking for my advice. They have been dating almost three years and he spends more awake time here than at home and thinks of my husband and I as a second set of parents.

Boyfriend is a smart kid and got quite a few scholarships. Together with his TOPS they amounted to about five thousand dollars a semester more than his tuition. Refund checks are about to be issued and he checked his account and found several of his scholarships missing and one reduced. This morning he went to the financial office at school and they told him that the university had declined the missing scholarships because the amount was more than his estimated cost of attending.

Can they just do that without even telling him? There is not a lot of money at home and he had already set up a savings account with the plan to save the overage for grad school when TOPS and his scholarships would not help. He is also working a couple of hours a day and putting that money away so he is not a spendy kid who was going to blow it.

This was all earned money - grade based, not grants or loans.

I've never heard of anything like this before. Any advice?

Penny

 

[kwitcherkicken99]

Yes. The point of scholarships is not to save them for later. They are supposed to be used up each semester.

Have him call the scholarships and see if any of them can be deferred to a later date, which will help him in the long run.

My student brought in over 100K last year in scholarship money. She had to have 2-3 of them deferred for soph, junior, and senior years of college.

Scholarship committees do reserve the right to reduce a scholarship if they feel the receipient has too much. A lot of scholarships are need-based, and once the financial report comes in to them, they may deem he's been given too much and try to pass on some of the money to someone else. It's not to say that he doesn't deserve it for the amount of work he put in.

 

[RunningGirl]

Yes. The point of scholarships is not to save them for later. They are supposed to be used up each semester.

Have him call the scholarships and see if any of them can be deferred to a later date, which will help him in the long run.

My student brought in over 100K last year in scholarship money. She had to have 2-3 of them deferred for soph, junior, and senior years of college.

Scholarship committees do reserve the right to reduce a scholarship if they feel the receipient has too much. A lot of scholarships are need-based, and once the financial report comes in to them, they may deem he's been given too much and try to pass on some of the money to someone else. It's not to say that he doesn't deserve it for the amount of work he put in.

I agree with this; very well said!

 

[kwitcherkicken99]

I agree with this; very well said!

Ugh! We had a lot of questions once she started getting all the scholarships in. We did have to tread lightly, but it was possible to have some of the scholarships deferred.

Have him call his counselor from high school and see if they can help make the contact to the scholarship committees.

Again, you have to do this gingerly - you don't want to come across sounding ungrateful or no longer in need of their generous donation to his collegiate education.

 

[lucyanna girl]

Thanks for the help. Deffering the money would be fine but he really will need this money to finish his education.

Penny

 

[kwitcherkicken99]

Some of them should be willing to work with him. I cannot stress involving his counselor from last year in this - they may have had previous experience with getting money deferred.

Hopefully he has several renewable scholarships!

 

[Mimi1965]

I have never heard of scholarship $$ for graduate schhol.

Maybe his plan is not "legal"?

 

[golfgal]

I have never heard of scholarship $$ for graduate schhol.

Maybe his plan is not "legal"?

There is a lot of money out there for grad school, scholarships, grants, etc. I know plenty of people that haven't paid anything or very little for grad school.

 

[bluesaturn]

I have never heard of scholarship $$ for graduate schhol.

Maybe his plan is not "legal"?

Most phd programs provide money to almost all students in the form of tuition remittance and stipend (for being a graduate assistant). You aren't going to find this situation for professional degrees such as med school, law schools, business schools etc. But in the OP's situation it sounds like the student was just going to save the excess money to use in grad school.

I had more scholarship money than charges in my student account all four years of undergrad and always received a refund. I was able to pocket the refunded amount (most went into savings). But it wasn't quite as much as $5K. Also, my scholarships were private or straight from the school. If these are state funded scholarships they might retain the right to reduce his award if it exceeds his need. He should contact the financial aid office.

One thing to note was that my scholarship amounts never counted toward "aid awarded" because they weren't financial aid, they were merit awards. I'm thinking if they were counted as aid I might not have received the full amount from each scholarship because they would have seen my need fully met. So maybe he needs to check if they are considering his scholarships as aid? But I am NOT a financial aid counselor so I have no idea how this works, beyond my own experience.

 

[Allison]

Yes, this is how it can work.
Schools use financial aid to provide up to the estimated cost of attendance. If the combination of outside scholarships and school grants exceed that cost you can start to see a reduction in awards. Many times a school would reduce the amount of money they give based on the outside scholarships.

 

[Sparx]

Yes, they can do this.

My university estimates my total yearly cost of attendance at 18,000. This is assumed to be my tuition, housing, food, gas, books, etc. I can receive up to that amount, but anything over that is declined. It sounds like this is what happened to your daughter's boyfriend.

 

[SandrA9810]

LuvsJack helped me out with some financial aid questions a few weeks ago. She's got lots of answers.

Some scholarships and grants are solely for tuition expenses. It goes directly to the school and the student never really sees the money. There are other scholarships like the Pell grant, which the student is given the check to be used on anything school related. He could keep the entire check and save it till later on, as the Pell grant is only good for undergraduate degrees.

The first step is to find how many scholarships he has. Then find out how the money is allowed to be used.

 

[Allison]

Also keep in mind scholarships in excess of qualified tuition and fees are taxable.

 

[Allison]

LuvsJack helped me out with some financial aid questions a few weeks ago. She's got lots of answers.

Some scholarships and grants are solely for tuition expenses. It goes directly to the school and the student never really sees the money. There are other scholarships like the Pell grant, which the student is given the check to be used on anything school related. He could keep the entire check and save it till later on, as the Pell grant is only good for undergraduate degrees.

The first step is to find how many scholarships he has. Then find out how the money is allowed to be used.

Pell grant recipients don't always get a check. It can be applied directly to the student's account.

 

[DisneyNutMary]

I'm new to the college financial aid thing, as my son is a senior in high school now. But wouldn't banking leftover money hurt the student in future years? I thought I understood it that FAFSA must be filled out each year, and money in the student's personal bank account would increase his family contribution and hurt the next year's aid package?
I am assuming some of the money in question is need based, or there would be less of a question on paying for graduate study.
Also, don't grad students also get aid packages?

Sorry if my questions sound dumb, but I am new to this, and it kind of sounds like someone it trying to work the system.

 

[bluesaturn]

I'm new to the college financial aid thing, as my son is a senior in high school now. But wouldn't banking leftover money hurt the student in future years? I thought I understood it that FAFSA must be filled out each year, and money in the student's personal bank account would increase his family contribution and hurt the next year's aid package?
I am assuming some of the money in question is need based, or there would be less of a question on paying for graduate study.
Also, don't grad students also get aid packages?

Sorry if my questions sound dumb, but I am new to this, and it kind of sounds like someone it trying to work the system.

I'm assuming it would increase family contribution, which would be bad if the awarded money was in the form of financial aide. If it's just merit money, FAFSA expected contribution wouldn't matter. But the OP didn't describe the types of scholarships.

I think you will find that most middle class families qualify for little financial aide. And often find their estimated family contribution to be much more than they could actually afford to pay. So if you aren't going to get much in financial aid anyway, you might as well save that extra money that is coming in.

Grad students are eligible for loans. I would want to minimize the about I have to take out in loans, to minimize the amount I have to pay back.

It is my understanding that some scholarships allow you to keep refund amounts after all the school's charges have been paid. This isn't working the system if it is allowed by the scholarship.

 

[SandrA9810]

Pell grant recipients don't always get a check. It can be applied directly to the student's account.

It can be either way. But Pell grants can be used for more than just tuition, if that's what the student wants to do. Some grants can only be used for fees charged by the college, or books purchased at the college bookstore.
Pell grant allows you to buy your books anywhere you want. You can use it for pens and paper or notebooks. It can be used for purchasing a bus pass to get to school. Or other things not sold within the school that he might need for his education.

If the kid doesn't have a job, or a small paying job, $5,000 more in his "income" probably wouldn't boost him into the next tax bracket.

If he knows what he wants to go into after his BA, many jobs offer scholarship programs for it's employees for continuing education. And sometimes, like teaching, there's state programs that will pay off student loans if you agree to work for some many years. So there's still ways to get money for higher degrees.

 

[tvguy]

I think you will find that most middle class families qualify for little financial aide. And often find their estimated family contribution to be much more than they could actually afford to pay.

Well, you have to remember that estimated family contribution includes parents getting loans. Also, FAFSA considers mom and dad's contributions to a retirement plan to be a luxury expense, money that should instead be spent on tuition (unless you are age 60 I believe, or older).
I think more accurately the estimated family contribution may be more that people WANT to pay, but based on their income, it is within their means.

 

[tonilea]

It is called "stacking" and is based on your COA or Cost Of Attendance. Your financial aid cannot exceed your expected COA. Check your school and state websites.

 

[disykat]

Scholarships that are not "need based" are still based on needing them for college expenses. They are generally not earned like prize money, but go directly to the college. If they're not needed, they're not dispersed.

I've been on several scholarship committees and we're always amazed at how many students think we're going to hand them a check - despite it clearly stating on the application that "the check will go directly to the school of your choice for tuition only."

There are some scholarships that are given without rules, but that's not the norm.