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Basics · 2026-07-18

Merit aid vs need-based aid: what's the difference

College aid comes from two very different places, and they follow different rules. Knowing which is which changes how you pursue more of it.

Need-based aid

This is aid tied to your family's finances. It is driven by the FAFSA, which produces your Student Aid Index, and it includes federal Pell Grants, most state grants, subsidized loans, work-study, and a lot of institutional aid. The lower your ability to pay, the more you generally qualify for. If your finances change, you pursue more of this through a special-circumstances appeal.

Merit aid

This is aid tied to you, not your income: grades, test scores, talent, leadership, or a specific field. Merit scholarships come from the college itself and from outside organizations, and many college merit awards are given automatically based on your application, no separate form needed. Income usually does not affect eligibility.

Why the difference matters

File the FAFSA either way; it is the gate to need-based aid and free to submit at studentaid.gov.

Offer not enough?

If your situation changed, you can appeal. We draft it around your school's own policy.

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