The Changing Landscape of Scholarships and Financial Aid – Scholarship America

The Changing Landscape of Scholarships and Financial Aid

By Matt Konrad

Updated April 2024

Over the last two decades, the conventional wisdom of American college life has been turned upside down. More and more students are taking “nontraditional” paths to college, either by taking time off after high school or returning to college as adults — according to research from Higher Learning Advocates, “Only 13% of college students live on campus, and two-thirds of all students work in order to make tuition payments or other expenses. Two in five students are over the age of 25, and a quarter of all college students are parents themselves.”

In addition, student and family costs have skyrocketed, as tuition has outpaced inflation and state aid to higher education has plummeted. Student loans have gone from a stopgap to both a major source of funding and a crippling source of debt. And this year’s troubled FAFSA rollout has left vulnerable students unsure of their financial aid futures.

All of these factors have made one thing clear: helping high school students get into college is no longer enough. Today, it’s all about full-spectrum assistance for students facing all kinds of circumstances. And, throughout students’ educational journeys, there are three major areas where supporters can make an impact.

Scholarships and Grants

The most traditional source of private-sector student funding is still vital despite all the changes in higher education. Scholarships have made the difference for tens of millions of students, and continue to do so.

The biggest impact in today’s financial aid landscape comes from renewable scholarships, which provide aid for multiple years as long as students continue to meet certain criteria. With scholarship displacement still a somewhat common practice, and upperclassmen losing out on financial aid as they go through college, renewable awards provide support that goes beyond freshman year.

It’s also increasingly important for students, families, scholarship management service providers and schools to work together to maximize the impact of scholarships.

“As a result of significant shifts in higher education over the last twenty years, colleges and universities have become much more creative in their admissions practices, financial aid packaging policies and management of institutional funds,” says Mike Nylund, Scholarship America CEO. “Unfortunately, the majority of scholarship programs are not built on this new paradigm and, as a result, probably not having the impact once envisioned. More so than ever, private scholarship sponsors simply have to become more creative in the program design to ensure their goals are being met; in essence, they need to catch up to the current environment.”

Emergency Aid

As they make their way through college, students will face more than just tuition costs. Even students who attend school tuition-free often find themselves struggling with transportation, food and other costs of living. Especially now, an unexpected financial setback like a medical bill or a change in housing can threaten to derail them from their academic track.

That’s why emergency aid programs have become such a crucial part of the financial aid picture. These emergency grants—providing small but vital payments on a fast timeline—can often make the difference between persisting and dropping out.

As we wrote here, “Over the last two decades, Scholarship America has partnered with colleges and private-sector funders to provide these kinds of grants. And while the average grant amount of $741 may not seem like a life-changing dollar amount, it can be a lifeline for those facing tough choices—95% of Scholarship America emergency grant recipients complete the term they are enrolled in and 88% enroll the next term.”

In addition to programs sponsored by colleges and nonprofits, the private sector has started to diversify into the emergency assistance space. For example, Wells Fargo created an emergency program specifically for U.S. military veterans faced with unexpected costs while in school.

Wraparound Supports and Workforce Development

While money is important, it’s not the only obstacle to students pursuing their degrees. As reported by Inside Higher Ed, “around one third of students enrolled in a postsecondary program have considered stopping their coursework in the past six months, according to an April 17 report from Gallup and the Lumina Foundation. The primary concern among students is emotional stress (54 percent), followed by personal mental health reasons (43 percent) and cost of higher education (31 percent).”

Students, especially those from low-income backgrounds, traditionally underserved communities and first-generation families, need more than just a scholarship check or a financial aid package.

To achieve their educational goals, these students rely on a network of financial, social and cultural support that can include mentoring, informal learning, assistance during emergencies and support with technology, housing and food expenses. Successfully navigating through college means focusing on the whole student. Mental health, physical well-being and basic needs are just as crucial as textbooks, Wi-Fi and office hours. At Scholarship America, we work with program sponsors to identify and serve student needs, from mental health support to internship and mentoring opportunities.

For both students and funders, it’s a wide new world of options. And whether you’re a high school grad, an adult learner or a scholarship provider, Scholarship America’s scholarship management and administration services can help you navigate them. Subscribe to our blog or contact us to stay updated.

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