The most significant difference between a private educational grant and a student loan is you don't have to pay a grant back. Once awarded a grant, you accept it with the understanding that you aren't responsible for paying any of the money back to the grantor.
Private grants differ from government grants such as state-funded or Pell grants in that the money comes from private individuals or organizations. The Pell Grant is a popular federal funding option but is often hard to obtain because only those with the greatest financial need qualify. For young students still considered dependents of their parents, the Pell Grant takes the parents' income into consideration, which tends to hurt the students' chances of qualifying for the grant. That's where private grants come into play.
Private grants have no public or government affiliation. Because of this, the requirements can be tailored specifically to whatever the private organization deems appropriate. Private grants come from social clubs such as Rotary, Kiwanis and Lions, alumni, nonprofits and private companies, and businesses.
Businesses in particular offer private grants to people of various ethnic groups in an effort to promote diversity. But there are all kinds of grants available -- in fact, you can find grants for all types of people. Here are some examples:
- Ethnic minorities
- Nurses or medical students
- Military personnel or family members
- Academic excellence
- Specialized fields in demand -- science, mathematics, engineering
- Low Income -- financial needs in addition to what you may receive from the Federal Pell grant
- Disabilities -- grants available to those with disabilities or handicaps
This list encompasses some specific areas. But let's say you don't meet any of these criteria. That's when you need to dig to find something you may qualify for. The next section gives you some ideas for places you can find private grants. You'll find, like most things, you'll be rewarded by your efforts.