Making the College Scholarship System Work

Rebecca Perez

Private scholarships helped Stanford freshman Rebecca Perez finance her education. Elaine Korry, NPR hide caption

itoggle caption Elaine Korry, NPR

Read the Report

The Institute for Higher Education Policy's May 2005 report "Private Scholarships Count" includes information on sources of private scholarships, and tips on how to spot possible scams.

Private Scholarship Sources

The Institute for Higher Education Policy found the sources of private scholarships to be wide-ranging, including:

  • Community foundations and tax-exempt philanthropic groups
  • Service and fraternal organizations such as American Legion chapters and the Kiwanis Clubs
  • Corporations
  • Independent foundations, scholarship funds, and educational trusts established for the purpose of funding scholarships
  • Research centers and institutes targeting scholarships for particular disciplines or areas of study
  • Associations, societies and other national membership organizations that tend to target scholarships toward specific purposes reflecting their interests
  • Local organizations such as garden clubs, art centers, local societies and other groups that focus their grants on local communities
  • Individual donors who establish their own scholarships or provide money to other groups

Advice from the Experts

NPR.org asked financial aid experts on tips for families looking for ways to pay for higher education.

Getting accepted into Stanford University was a dream come true for Rebecca Perez. But the daughter of a low-income farm worker knew that financial aid alone wouldn't cover the $40,000 yearly tuition. To bridge the gap, Perez applied for more than a dozen private scholarships — as much as $100 million of which goes unclaimed each year.

Web Extra: Private Scholarship Aid

"Private Scholarship Counts," a new report from the nonprofit Institute for Higher Education Policy, looks at the availability of private scholarship funds in America and the role they play in higher education. The executive summary of the report is excerpted below. A link to the full report is at left.

Executive Summary

Private scholarship aid is one of the least understood but nevertheless important aspects of our nation's system for enhancing access to higher education. This report, the first-ever comprehensive study of private scholarship aid, attempts to provide a broad understanding of what private scholarship aid is and why it counts from the perspective of students and private scholarship providers. "Private scholarship aid," broadly stated, is money from private donors that is awarded to students for college and does not have to be repaid. Specifically, in this study private scholarship aid is defined as grant monies awarded to students from private sources that are unrelated to college and university endowments or foundations and designated to be used for postsecondary educational expenses.

The study draws from a broad array of sources to determine who receives private scholarship aid, how much they receive, and from whom. The study includes the findings from an unprecedented original survey of private scholarship providers, new data from the U.S. Department of Education's National Postsecondary Student Aid Study (NPSAS), interviews with private scholarship providers, and other sources. Because of the complexity of collecting and verifying information about the volume of private scholarships coming from thousands of different, and often small, providers, much of the analysis in this report uses these data sources to develop estimates of private scholarship aid rather than precise totals. Key findings from the study include:

· Total private scholarship aid was between $3.1 billion and $3.3 billion in 2003-2004, according to a middle-range estimate;

· Approximately 7 percent of undergraduate students received private scholarships, with an average value of $1,982, compared to 5 percent of graduate students who received $3,091 in private scholarships, and 10 percent of professional students who received an average of $5,029 in private scholarship aid;

· Total aid that went unawarded — the so-called "unclaimed" aid that is the subject of numerous Internet solicitations and other marketing efforts — may be approximately $100 million annually;

· The typical private scholarship recipient was a traditional undergraduate: between the ages of 15 and 25 (81 percent to 89 percent), from a middle-income family, dependent on his/her parents, attending a four-year institution (more than three quarters) on a full-time basis; and

· Some private scholarship recipients do not fit the typical characteristics. These included students with disabilities, low-income students, and students of color. For example, the study projects that at least 30 percent, and perhaps as high as 50 percent, of all private scholarship recipients were students of color.

All student aid (including grants, loans, work study, and tax credits) from federal, state, and institutional sources in 2003-2004 totaled $122 billion, according to the College Board. Of this total, $46 billion was in the form of grants. Private scholarships account for 2-3 percent of total aid awarded nationally, or about 7 percent of total grant-based aid, and represent more than half the size of the total amount of state aid awarded or more than three times the size of the Federal Perkins Loan program.

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