A merit scholarship is a type of college financial aid that is awarded based on a student’s merits, which might be academic, athletic, artistic, leadership-related, or pertaining to a special interest. A merit scholarship does not take a student’s financial need into consideration.
Read on for a closer look at exactly what a merit scholarship is, the different types of merit scholarships available, and how to get merit aid to help you pay for college.
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What Is a Merit Scholarship?
Merit scholarships, also known as merit aid, are a kind of college funding that is not based on financial need but, instead, on a student’s merits or achievements. Merit aid is often given to students that excel in academics, extracurricular activities, athletics, arts leadership, and other areas.
Merit aid is often funded by colleges and universities themselves, and can typically be redeemed for multiple semesters and years. This type of financial aid is often used as a way to lure top performing students to their school. It might be a few thousand dollars or it could cover a student’s entire tuition. Merit scholarships are also offered by organizations, like the National Merit Scholarship Corporation, and private companies.
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Types of Merit Scholarships
Merit scholarships come from different types of institutions and are awarded for a variety of reasons. Here’s a look at the different kinds of merit scholarships that are available.
Colleges and Universities
Many colleges and universities have merit aid awards that are offered to students. Sometimes referred to as institutional aid, merit aid programs vary from school to school. Some schools may consider all students for a merit award without needing an additional application. In some cases, there may be an additional application required. Select merit aid awards may be designed to cover the full cost of tuition, while others will only cover a portion.
Academic Merit Scholarships
Academic merit scholarships award money to students who demonstrate significant academic achievement in high school. Often, academic merit scholarships may consider a student’s grade point average (GPA), standardized test scores, class rank, or other factors.
Depending on the school, you may not need to submit or do anything extra to be awarded a merit-based scholarship. Instead, the school may decide based on your application alone. Academic merit aid is often redeemable for multiple years if you uphold the scholarship qualifications (such as maintaining a certain GPA each semester).
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Athletic Merit Scholarships
Like academic merit aid, athletic merit scholarships are typically funded by the college or university. If you’re interested in an athletic scholarship, keep in mind that getting recruited can be a time-intensive process. Depending on the sport you play, you may need a highlight reel or video that shows off your skills. Typically, schools will also want to see your academic records and SAT or ACT scores.
Athletic scholarships may be offered for each year you attend school, provided you meet certain requirements, such as attending a certain number of practices/games each week while also maintaining a certain GPA.
Arts Merit Scholarships
Many liberal arts colleges offer merit scholarships to students who excel in the arts, such as music, acting, painting, drawing, or graphic design. If you have talent in and have been focusing on any area of the arts, you may be able to get merit money by applying for a degree program in the arts at a particular college or university.
Merit Scholarship Options From Organizations
Some nonprofits and community organizations offer their own merit scholarships to standout students. These scholarships have varying requirements but will typically focus on an eligibility requirement that’s important to the organization, such as a student’s leadership qualities, chosen career path, or involvement in community service during high school.
• The Daughters of the American Revolution (DAR) offers the Richard and Elizabeth Dean Scholarship to students who are pursuing an undergraduate degree in American Studies.
• The Society of Women Engineers (SWE) offers a scholarship to applicants who are studying at an accredited university and pursuing a career path in engineering, engineering technology, or computer science.
• The National Association of Flavors and Food-Ingredient Systems (NAFFS) offers an annual scholarship to outstanding food science students.
Another source of merit scholarships is private companies. Companies like Coca-Cola, Burger King, Google, and more have annual scholarships. Like many other scholarship opportunities, the application requirements and eligibility criteria will vary based on the company and/or scholarship. Below are a few examples.
Coca-Cola Scholars Program
The Coca-Cola Scholars Program
is an achievement-based scholarship awarded to students in their final year of high school. Students are recognized for their ability to lead and serve, as well as their commitment to making a significant impact on their schools and communities. In 2023, the program provided over 6,750 Coca-Cola Scholars with more than $81 million in educational support.
Burger King Scholars
The Burger King Scholars program provides scholarships ranging from $1,000 to $60,000 to high school students who stand out based on their GPA, work experience, extracurricular activities, and community service.
Generation Google Scholarship
The Generation Google Scholarship program is designed for students pursuing degrees in computer science. The scholarship is awarded based on the strength of each candidate’s commitment to diversity, equity, and inclusion; demonstrated leadership; and academic performance. Selected students can receive $10,000 for college.
National Merit Scholarship Corporation
The National Merit Scholarship Program is an annual academic competition among high school students for recognition and college scholarships run by the nonprofit National Merit Scholarship Corporation (NMSC). To enter the program, you simply need to take the Preliminary SAT/National Merit Scholarship Qualifying Test, generally during your junior year, and meet other program entry requirements. There are three types of awards: National Merit Scholarships of $2,500, corporate-sponsored scholarships, and college-sponsored merit scholarships.
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How to Apply for a Merit Scholarship
The process for applying to a merit scholarship can vary significantly from scholarship to scholarship. Merit scholarships offered by colleges and universities typically don’t require students to fill out any additional paperwork beyond their application to the school. However, some schools require that students submit the Free Application for Federal Student Aid (FAFSA) to be eligible. This allows students to maximize their federal and state need-based financial aid before receiving school awards. It’s a good idea to contact the financial aid department for each school and ask what their merit scholarship process is.
Applying for merit aid from a source other than your school can be more time-consuming and will likely vary depending on the organization offering the award. In addition to an application detailing basic personal information, students may be required to write an essay or personal statement, gather letters of recommendation or go through an interview process.
If you’re interested in applying for a private merit scholarship, check in with the organization directly so you can be sure that you understand exactly what the application requirements are.
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What Can Merit Scholarships Pay For?
Frequently, if the merit scholarship is offered by the school, the award will go directly to pay your tuition bills. If there is any money left over after tuition is paid for, it can be used to pay for other educational expenses including room and board, books, or other fees. Each school will have its own procedures for how merit aid is awarded to students, so confirm any questions directly with the financial aid office.
Merit Scholarships and Income Taxes
Generally speaking, merit scholarships are not taxed by the Internal Revenue Service (IRS). According to the IRS, scholarships and grants are considered tax-free so long as the following conditions are met:
• The student is pursuing a degree at an educational institution; and
• The award money is used to pay for tuition and fees or other expenses related requirements at the educational institution, such as fees, books, and supplies.
There are some situations in which a merit scholarship may be taxed. If a grant or scholarship meets the following criteria, it may be taxable, according to the IRS:
• The scholarship is used to pay for incidental expenses such as room and board, travel, or optional equipment.
• The scholarship is awarded as payment for teaching, research, or other services (though there are some exceptions).
If you have any questions about whether or not a scholarship you’ve received is considered taxable income, consider consulting with a tax professional who can provide advice specific to your personal circumstances.
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Finding Merit Scholarships
Check in with your college or university to find out if there are any school-specific awards available and determine how to file an application (if an additional application is required). There are numerous online resources and databases that can help you identify merit-based scholarships across the U.S. For students who are pursuing graduate degrees, there are also some scholarships for graduate students.
It can be a good idea to make a running list or spreadsheet of all of the merit-based scholarships that you are interested in, so you can keep the specific due dates and application requirements organized. This can help make the application process feel less overwhelming.
Consider Starting Early
Many merit-based scholarships look for demonstrated excellence over the course of an applicant’s entire four years of high school. Therefore, it could be a good idea to start thinking about what types of merit scholarships you’re interested in applying for as early as possible.
Maintaining Your Scholarship
It is important to note that some merit-based scholarships require the scholarship recipient to maintain a certain GPA and/or require specific campus or community involvement to continue receiving consistent scholarship funding.
If you do decide to apply for a merit-based scholarship, it’s a good idea to be prepared to not only do the hard work to secure the scholarship but also maintain it once you get to campus.
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Other Ways to Help Finance College Tuition
If you do not receive any merit aid or enough merit aid to fully cover your college costs, there are still many funding options available to you. Often, the first step for students looking to secure aid is to fill out the FAFSA. Students must fill this out in order to receive any federal aid, including federal grants and scholarships, work-study, and federal student loans.
The federal work-study program sets students up with part-time jobs where they can earn money to put towards their educational costs.
Federal student loans offer low fixed interest rates, flexible repayment options, and possible forgiveness programs. Depending on your level of need, you may qualify for either subsidized or unsubsidized federal student loans. With a subsidized loan (for undergrads only), the federal government pays for any accruing interest on your loans while you’re in school and for six months after you graduate; with an unsubsidized loan, you are responsible for paying all interest that accrues on the loan.
If federal aid and merit-based scholarships aren’t enough to cover the cost of college, you might consider getting a private student loan. These loans are offered by banks, credit unions, and online lenders. Students and their co-signers (if applicable) apply for private student loans as if they were applying for other types of loans, such as auto and home loans.
Private student lenders are able to determine their own term lengths, interest rates, and repayment plans. Because these loans don’t come with the same borrower protections as federal student loans (such as income-based repayment plans and generous forbearance and deferment programs), you generally only want to consider private student loans after you’ve fully tapped federal aid options, including federal student loans.
💡 Quick Tip: It’s a good idea to understand the pros and cons of private student loans and federal student loans before committing to them.
Merit scholarships are awarded to students based on merit alone, which might be academic, athletic, artistic, or in another specialized area. This money typically does not need to be repaid by student recipients. Some sources for merit scholarships include your college or university, nonprofit organizations, private companies, and the National Merit Scholarship Corporation.
Other options for college funding include financial aid (which includes need-based grants and federal student loans) and private student loans.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
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