Financial aid is most often need-based. If a family or student cannot afford college, both colleges and the federal government offer them loans to get through college. But, there are also scholarship monies and grants. Both of these are further financial aid opportunities which do not have to be paid back. Many colleges offer merit aid or merit scholarships to attract students. This aid is based on merit, or the student’s academic abilities and achievements.
Colleges offer merit aid to attract better students. Merit aid is like competitive pricing. If you buy us we will lower the price. The use of merit aid helps school sustain their enrollments.
Some object to merit aid. The arguments include colleges should be attracting students based on their own merits and the quality of their education and that colleges are only revealing they are overpriced to begin with if they can offer some students tuition for less when there is not real need.
Others believe merit aid is valuable because there are students who need help paying for their education, and any helped offered, especially if it is for good academic performance, is a boom.
The answer could be to simply cut college tuition cost or to base all financial aid on need. However, when colleges cut their price tag, they make less revenue and have less money for any kind of financial assistance, including need-based aid. Also, many students may not qualify for need-based assistance but really cannot afford the cost of college. Maybe they can qualify for a $10,000 loan, but without an additional $5,000 given for merit, they have to turn away from a college acceptance. After all, parents making $150,000 annually still have a hard time paying for four years of college, especially if they have more than one child.
Merit aid may be just that additional vehicle to help both colleges and parents and students. The best solution for college students is to make sure they apply for any and all kinds of financial assistance.