Avoiding Student Loan Debt With Scholarships and Grants

Scholarships and grants are a great option for students wanting to avoid student loan debt, because these funds do not have to be repaid. There are thousands of scholarships and grants available for students seeking higher education.


College Scholarships

There are federal, state, local, and departmental- or school specific scholarships available for all types of students. Here are examples of common college scholarships that help thousands of individuals each year avoid student loan debt.

  • Athletic Scholarship – Athletic scholarships go to outstanding athletes who are recruited to play a sport for their post-secondary institution.
  • Academic Scholarship – Academic scholarships go to students who demonstrated academic excellence in high school. Once in college, students with academic scholarships must maintain a certain Grade Point Average to remain eligible for financial assistance.
  • Departmental Award – Departmental scholarships go to students who wish to study a particular field in college. Like athletic scholarships, these students are often recruited to study in a particular department at the institution.


Federal Grants – The Pell Grant

The most popular federal grant is called the Federal Pell Grant. The government awards Pell Grants to students who show the greatest financial need for higher education expenses. Like college scholarships, the Federal Pell Grant is very competitive because the money awarded does not have to be repaid. It, too, helps scholars avoid the stress of student loan debt.


Demonstrate Financial Need

The government determines an applicant’s eligibility for the Pell Grant with the Free Application for Federal Student Aid (FAFSA). The FAFSA determines how much money you are eligible to receive for college, thus helping you to avoid student loan debt. It assesses financial need by calculating Expected Family Contribution (EFC). A student’s EFC is based total family size, income, and assets, the cost of the institution, whether the student is full or part-time, and the number of years the student will attend the institution.


Most Pell Grant recipients have an Expected Family Contribution below $30,000. In some cases, however, the government considers applicants with family incomes up to $60,000.


Other Qualifications

To avoid student loan debt and qualify for a Federal Pell Grant, you must:

  • be a U.S. citizen or eligible noncitizen
  • have a high school diploma, GED, or show that you will benefit from the program
  • only use grant funds toward education expenses
  • prove that you are not in default on a federal loan
  • not owe repayment of a federal grant
  • not have been convicted for drug possession or sale while receiving federal funds
  • not in danger of imprisonment


In order to initially qualify and remain eligible for a Pell Grant, students must maintain a high Grade Point Average (usually a 3.0). Students also must attempt a certain number of hours while in school, depending on their enrollment status.


If you’re considering college and wish to avoid student loan debt, research and apply for applicable scholarships and/or grants as soon as possible!


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