When it comes to financial aid for college, there’s something of a loose hierarchy when it comes to funding sources. Loans are undeniable at the bottom. They’re easy to get, but you have to pay them back with interest, and hope you don’t accrue any fees or penalties.

Grants and scholarships are often lumped into a category together because they seemingly work the same way. That’s actually a bit of a misconception. However, scholarships are by the most popular and most sought after form of financial aid. That’s why we’d like to share with you a few things you need to know about them.

Effect on EFC

Your EFC or expected family contribution is how much you’ll have to pay after the financial aid you get from the school/government. If your scholarship comes from the school, it shouldn’t affect your EFC. However, most outside scholarships are considered taxable income and will most likely raise your EFC. It’s not the worst thing in the world, because you will have the added resources. But it can be a problem if you don’t get as many outside scholarships the following year. It’s just something to keep in mind.

You Get What You Give

There are scholarships out there for just about everything. Seriously, there’s a scholarship for being tall. The thing is, they aren’t going to seek you out. You have to turn over every stone you can to get what you need. Most times, it won’t be as simple as just finding the scholarship and clicking a button saying you want it. You’ll probably have write essays, complete projects, and you may even have to interview for certain scholarships. Don’t let this discourage you; it can definitely be worth the work. In fact, you might even consider it a good thing. The added barriers of entry make other people less interested, which cuts down on your competition and ups your chances. Keep at it.

Don’t Stop Believing

When people think about scholarships, they are often imagining high school seniors about to make the transition into college. Fun fact, you can research and apply for scholarships all throughout college. This also means that most scholarships work in seasons. That means that just because you didn’t get something you applied to once, that doesn’t mean you shouldn’t apply again next time. You never know.

Spend It Wisely

A lot of scholarships are applied directly to tuition, as tuition is usually the biggest price tag. That said, many scholarships are given directly to the student to be used as they see fit…within specified guidelines.

You can use the money for pretty much any other education-related expenses like textbooks, supplies, even laptops or tablets. You can also put it towards room and board costs whether you live in the dorms or not.

The truth is that no one actually tracks how you spend the money. So, if you wanted to spend it on frivolous things, there’s not a scholarship police that is going to stop you.

However, they do keep track of how much they give you. If you blow your money on things you don’t need instead of getting the things that you do, you’ll find people unsympathetic going forward.