Introduction: What are Income-Based Scholarships?
Do you consider yourself a college student from a low-income family? If yes, you’re not alone, if that’s any consolation. The number of low-income undergraduates increased from 32.3% (1995-1996) to 43.1% (2015-2016).
This is, indeed, a big jump in enrollment among low-income college students. The increase in the number and scope of income-based scholarships is part of the reason. These are college scholarships for low-income students specifically. The students who receive them increase their chances of degree completion. Plus, they are less likely to take out student loans.
Unlike merit-based scholarships, these aren’t based on academic and athletic achievements. Instead, low-income levels are their primary factor. Keep in mind that there’s a specific standard to determine who and what is a low-income student.
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We want to emphasize that need-based and income-based scholarships aren’t the same. While these provide students with financial aid, their criteria and focus are different.
On one hand, income-based scholarships depend solely on income levels to choose recipients. Low-income students are the priority in the selection process.
On the other hand, need-based scholarships consider other factors to determine financial need. Family income, net assets, and number of college students in the family are common. Your unique financial circumstances are also taken into account.
Why Income-Based Scholarships Matter
Colleges and universities provide income-based scholarships for good reasons. The impact of these scholarships goes beyond the individual – society benefits, too.
Reduce financial barriers to higher education
Even in colleges with ultra-affordable tuition, cost is a barrier for low-income students. At Brigham Young University-Idaho, for example, the average tuition and fees is $4,536/year. For a low-income family, it’s a significant chunk of their annual income.
This is where scholarships for financial need come in. Income-based scholarships can cover the cost of tuition and fees. In doing so, there’s one less barrier to higher education among low-income students.
Of course, there are incidental costs, including books, supplies, and living expenses. But with most, if not all, of tuition and fees covered, it’s one less thing to worry about.
Affordable education becomes a reality, too, with financial aid for college expenses. Federal and state financial aid can cover other educational expenses, such as books and supplies. Examples include the California Dream Act and New York State TAP.
Look into private need-based scholarships, too. The Gates Millennium Scholars Program and Dell Scholars Program are great examples. These are all excellent means of reducing college costs through scholarships.
Reduce student loan debt
Unfortunately, low-income students are more likely to take out student loans. These loans can be from government and private sources. Whatever the source, student loans can accumulate over time. Interest, surcharges, and penalties increase the financial burden.
Low-income students can take on new loans to pay off old loans and to finance college expenses. And so the cycle begins. Today, the average student will incur $40,681 in total student loans after graduation.
Scholarships for students with limited financial means reduce the likelihood of taking out student loans. Even when you borrow money, it’s significantly less than without income-based scholarships.
Increase access to higher education
State governments have been cutting funding to public colleges and universities. Income-based scholarships, fortunately, increase college financial support for low-income students. These scholarships can offset the increase in tuition and fees.
These three main benefits of income-based scholarships bring secondary personal benefits, including:
- Promote academic success among students since they can focus more on their studies.
- Reduce the need for part-time work and, thus, improve student learning outcomes.
- Expand your network, including mentors, industry professionals and fellow scholars.
- Increase your career advancement opportunities through an expanded network.
Society also benefits from accessible education for all income levels, including:
- More educated and skilled workforce
- Better equality and social mobility
- More diversity in education
Indeed, income-based scholarships make our nation a better place for everybody. Low-income students and their families benefit the most. A college education doesn’t only come with higher earning potential. It also means a better quality of life, access to services, and a healthier mind and body.
How Do Income-Based Scholarships Work?
Who are considered low-income students in the first place? Low-income students are those whose annual family income is at or below 150% of the federal poverty threshold.
The federal poverty level for families depends on the number of individuals in a family. For 2024, the federal poverty levels are as follows: (These are for the 48 contiguous states, the District of Columbia, and all US territories. Hawaii has lower FPL while Alaska has higher FPL.)
| Family Size | Federal Poverty Level | 150% of the Federal Poverty Level |
| Family of 2 | $20,440 | $30,660 |
| Family of 3 | $25,820 | $38,730 |
| Family of 4 | $31,200 | $46,800 |
| Family of 5 | $36,580 | $54,870 |
| Family of 6 | $41,960 | $62,940 |
| Family of 7 | $47,340 | $71,010 |
| Family of 8 | $52,720 | $79,080 |
Add $5,380 for every additional individual in families with more than eight members. Note that the figures are “modified adjusted gross income,” usually the same as adjusted gross income.
Let’s say you’re in a five-member household. Your family’s modified adjusted gross income is at or below $54,870 per year. You’re then considered a low-income student.
You must provide valid supporting documents to establish your low-income status. Every college and organization that offers income-based scholarships has its selection criteria and process. The above criterion for a low-income student may or may not be applied.
The most common requirements, nonetheless, include:
- Proof of income, such as tax returns and W-2 forms
- Up-to-date, complete, and accurate FAFSA. Colleges may also require the completion of your CSS profile.
- Residency status
- Enrollment status
- Individual circumstances that prove significant financial challenges in paying for college
A panel of financial aid officers and other authorized individuals usually make the selection of scholars. Appeals may be made if you’re unsatisfied with your application outcome. But be prepared, too, because scholarship decisions can be final.
Steps to Apply for Income-Based Scholarships
Due to the sheer number of applications, income-based scholarships can be competitive, too. Getting these scholarships demands careful planning and organization. Here are effective tips for success:
Research income-based scholarships.
Frequently, you only need to ask about income-based scholarships to get reliable information.
- Start by asking your college’s financial aid office for a list of income- and need-based scholarships.
- Check your local community organizations for scholarship opportunities. Nonprofit organizations, business corporations, and charitable foundations are excellent sources. Ask your local chamber of commerce for a list of businesses, too.
- Use the online scholarship databases mentioned below.
Make a list of the income-based scholarships you’re qualified for. Be sure to understand the eligibility requirements, application deadlines, and selection process. Ask for clarification if necessary. You can’t risk missing a single detail when payment of your tuition and fees depends on it.
Gather the required documents.
Again, the required documents vary between income-based scholarship programs. Besides the proof of income documents, other documents can include:
- Personal identification documents, such as birth certificate
- Academic records, such as proof of enrollment
- Personal essay or statement, in case you’re encouraged to share details of your specific financial challenges
Double-check the completeness and accuracy of your required documents before submission. Both form and substance are a must.
Complete the scholarship applications.
Read the entirety of the scholarship application forms first before filling in the required fields. If possible, fill out a draft and then copy the final form when you’re sure of the answers. Attach the required supporting documents in the recommended manner. This may be through an email attachment or via snail mail.
Submit your applications.
Once you do, it’s up in the air. Be sure to meet the application deadlines to increase your chances. Check the status of your applications, too, if possible.
Follow up on the status of your applications, if it’s allowed. Otherwise, don’t.
Respond to requests for additional information and interviews.
These aren’t guarantees of approval, but it pays to be prepared with relevant information. You may be asked, for example, for your payslips from a work-study program.
Receive your scholarship awards.
If you’ve been selected, congratulations. You must follow the instructions on accepting your scholarship. These can include signing an acceptance form and providing your student number.
Be mindful of the terms and conditions that come with income-based scholarships. You should also look at the renewability of scholarships. This way, you may be able to finance your college education for its entirety on income-based scholarships.
Additional Resources and Tips for Finding Income-Based Scholarships
Besides keeping the above step-by-step guide on applying for income-based scholarships, here are more effective tips.
Start early.
Don’t wait until you’re a freshman college student. Do your research during your junior year in high school. You and your parents will have ample time to check out these scholarships.
Stay organized.
Use traditional or digital tools to trac income-based scholarships. Take note of eligibility requirements, application deadlines, and status, among others.
Create tailored applications.
Every scholarship program has its specific aspects. Your application packet must then be tailored according to these unique requirements. Your statement must be different for every application.
Most importantly, find and apply to as many income-based scholarship programs as you can. Here are online resources that provide reliable information on this matter.
- Scholarships.com provides filters that categorize scholarships into sub-categories.
- Fastweb notifies you when there are new scholarship matches based on your filters.
- The College Board aids students in finding scholarships through a matchmaking process.
- Going Merry enables students to submit multiple scholarship applications in one go.
- ScholarshipOwl organizes scholarships based on filters, too, such as the amount and eligibility requirements.
- Bold.org features a user-friendly interface and useful filters.
- Cappex compiles scholarship opportunities based on filters, including renewable scholarships.
- CareerOneStop features more than 8,000 scholarships at any one time.
- Scholly ranks scholarships based on your experience, background, and needs.
These websites usually redirect to the scholarship programs’ official websites. Always refer to the official websites when considering an application.
Conclusion: Encouraging Access to Higher Education for All
Income-based scholarships provide low-income students with the opportunity to pursue a college education. These are a type of financial aid that cover the cost of tuition and fees. The coverage can be significant, too, resulting in affordable and accessible education for all.
If you’re a low-income student struggling with college expenses, you must consider these scholarships. These aren’t competitive scholarships per se in the same manner as merit-based scholarships. But you must be transparent, honest, and persuasive in your application.
You must exert due diligence in finding and applying to these scholarship programs, too. While there are hundreds available, you’re in competition with thousands. But when you cop these scholarships, you’re one step closer to your dream of a college education.