Study Cites Importance of Private Scholarships

A new report indicates that private scholarships — "one of the least understood but nevertheless important" forms of financial aid — account for more than $3 billion each year to help students pay for postsecondary training. These scholarships, the study shows, help students who slip through the cracks of other aid programs and promote choice and affordability for a broad range of students.

The Institute for Higher Education Policy prepared the report, “Private Scholarships Count: Access to Higher Education and the Critical Role of the Private Sector,” in collaboration with the National Scholarship Providers Association and Scholarship America and with the support of Lumina Foundation for Education.

The announcement of the study's findings on May 4 helped kick off National Scholarship Month, an annual observance for which USA Funds^® is serving as supporting sponsor for the fourth consecutive year. National Scholarship Month recognizes the current level of private-sector support for scholarships for higher education and calls for broader private-sector support for scholarships.

The “Private Scholarships Count” report indicates that private scholarships accounted for 7 percent of all postsecondary-education grants in 2003-2004. Despite this relatively low percentage, these scholarships are critical because they can be targeted at a local level, focusing on groups of students meeting a wide range of criteria. Additionally, private aid complements federal and other aid by making college more affordable for both low- and middle-income students and broadening students' educational choices.

The report lists the following types of organizations as key sources of private aid:

• Community foundations.
• Service and fraternal organizations.
• Corporations.
• Independent foundations.
• Research institutes.
• Associations and national membership organizations.
• Local organizations.
• Individual donors.

To bolster private support for higher education, “Private Scholarships Count” offers the following recommendations:

• Develop and fund new programs that mirror the success of the diverse programs that currently provide private scholarships.
• Increase communication among private scholarship providers to facilitate the exchange of ideas about management, fund raising, student selection, and award-distribution practices.
• Provide enhanced support for private scholarship programs, especially through the establishment of local, community-based programs that can be funded by local dollars and staffed by community volunteers.
• Conduct additional research building on the findings of this study.

"Private Scholarships Count" is available for downloading through the IHEP Web site. You will need Adobe Acrobat Reader.

A number of other events will join the announcement of the study's results in marking National Scholarship Month. One initiative, the fund drive “A Dollar a Day in May,” encourages individuals to give a dollar each day and corporations to donate funds in increments of $31 to support postsecondary education.

For more information about events across the nation, or to add your event to the National Scholarship Month calendar, visit the National Scholarship Month Web site.

National Scholarship Month is an initiative of Scholarship America. USA Funds' support for the observance is consistent with USA Funds' mission in support of financial access to higher education.