While both grants and scholarships are free money, there are differences. A grant is one type of financial aid, not limited to students, and usually dispersed by the government. A scholarship is financial aid specifically designated for further education.
Grants are dispersed for a multitude of reasons. Types of grans include merit-based grants, need-based grants, and grants limited to specific categories of students such as women, minorities and students with disabilities. The most popular federal grants are Pell Grants. The amount each student may receive is determined after the student completes the Free Application for Federal Student Aid. Pell Grants are primarily designated for low-income families. Another option is the Federal Supplemental Educational Opportunity Grant, which is given to undergraduate students with the greatest amount of unmet financial need who also qualify for the Pell.
Scholarships are awarded for merit rather than need. Scholarships may require the student to write an essay on a specific topic, or they may award money based on artistic ability, athletic skill or grade point average. Performing thorough research, creating a strategy and remembering deadlines can help in the effort to obtain scholarships and grants. Studies have shown that high amounts of scholarship money remain unclaimed each year.