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Pay for College

Different Types of Student Financial Aid

Financial aid is money that can help students pay for college, and it can come from federal and state governments, colleges and universities, and private organizations. There are three main types of financial aid for students: grants and scholarships, federal work-study, and student loans.

Main types of financial aid for students

Grants & Scholarships
"Gift aid" or free money, which means they do not have to be repaid.
Federal Work-Study
Allows students to work part time on or near campus while in college.
Student Loans
Sums of money that help students pay their college expenses and must be repaid.

Grants and Scholarships

Grants and scholarships are types of "gift aid" or free money, which means they do not have to be repaid. They are available through federal and state governments, colleges and universities, and local and national private organizations, and are awarded based on a variety of factors such as:

  • Financial need
  • Academic merit
  • Artistic, musical, or athletic talent
  • Interest in a particular field of study

The college financial aid office will determine your eligibility for grants and scholarships from the school and from federal and state governments. To find out about local scholarships that may be available to you, check with your school counselor, employers, civic groups, public libraries, and community organizations. And beware of scholarship scams that attempt to charge you a fee for scholarship assistance, which is usually free.

Here are common grants and scholarships that you may receive as financial aid:

Federal Pell Grant

A Federal Pell Grant is given to undergraduate students with high financial need (StudentAid.gov)

Federal Supplemental Educational Opportunity Grant (FSEOG)

The Federal Supplemental Educational Opportunity Grant (FSEOG) is given to undergraduate students with exceptional financial need (StudentAid.gov).

Teacher Education Assistance for College and Higher Education (TEACH) Grant

The Teacher Education Assistance for College and Higher Education (TEACH) Grant is a federal grant that provides up to $4,000 per year to students who agree to teach for four years at an elementary school, secondary school, or educational service agency that serves students from low-income families and to meet other requirements. If the service obligation is not met, the grant is converted to a Direct Unsubsidized Loan (StudentAid.gov).

Massachusetts John and Abigail Adams Scholarship

The Massachusetts John and Abigail Adams Scholarship provides a tuition waiver for up to eight semesters of undergraduate education at a Massachusetts state college or university. The scholarship covers tuition only; fees and room and board are not included. The tuition waiver at University of Massachusetts campuses only covers a portion of tuition – check with each campus for exact amounts. The scholarship must be used within six years of a student's high school graduation (osfa.mass.edu).

College and University Grants and Scholarships

College and university grants and scholarships are those funds provided directly by colleges and universities.

Private Scholarships

Private scholarships are funds offered by many different sources, including corporations, non-profits, associations, and agencies, to help with college costs.

Federal Work-Study

Federal work-study allows students to work part time on or near campus while in college. Students are paid work-study funds throughout the academic year for the hours that they work, and they can use the earnings for living expenses, books and supplies, and other indirect educational expenses. Work-study earnings are taxable, but they are excluded from the student's total income within the financial aid calculation.

Federal Loans

Student loans are sums of money that help students pay their college expenses and must be repaid. There are a few different loans provided by the federal and Massachusetts governments.

Federal Direct Student Loan

Every eligible student who submits a FAFSA® is qualified to receive a Federal Direct Student Loan. You should borrow a Federal Direct Student Loan before you borrow any other loan because these loans offer fixed interest rates and several repayment options. This loan does not require a credit check and the student is the sole borrower. The current maximum Federal Direct Student Loan amounts are as follows for undergraduate students. Graduate student limits are larger and can be found here.

  • $5,500 for freshman year
  • $6,500 for sophomore year
  • $7,500 for junior year
  • $7,500 for senior year

The interest rate on the Federal Direct Loan is fixed for the life of the loan, though each academic year's new loans have a new interest rate determined by the 10-year Treasury note rate and an additional percentage. The loan is always unsubsidized for graduate students, but can be either subsidized or unsubsidized for undergraduate students:

  • SubsidizedNeed-based aid, for which the federal government pays the interest while the student is in school.
  • UnsubsidizedNot need-based, and available to anyone who files the FAFSA. The student may choose to pay the interest while enrolled or defer the interest and add it to the principal amount of the loan upon leaving school.

Massachusetts No Interest Loan (NIL)

The Commonwealth of Massachusetts offers the Massachusetts No Interest Loan (NIL), a loan with zero interest and created to help needy Massachusetts residents attending post-secondary educational institutions in Massachusetts pay for educational costs.

Federal Direct Graduate PLUS Loan

The Federal Direct Graduate PLUS Loan is a federal loan available to graduate students. You must submit an application and undergo a credit check to apply for a Graduate PLUS Loan. Like the interest rate on the Federal Direct Student Loan, the Graduate PLUS Loan interest rate is fixed for the life of the loan, though each academic year's new loans have a new interest rate determined by the 10-year Treasury note rate and an additional percentage. The loan is unsubsidized. You may borrow up to the school's full cost of attendance minus any additional aid received.

Visit our Financial Aid Applications page to learn about applying for financial aid for students.

Save for college early

Learn more about college financing

Want a full overview of the financial aid application process? Watch our College Financing webinar. You'll learn about financial aid applications and types of financial aid, the factors that determine your aid eligibility, how colleges determine the amount of aid to offer, and the details of financial aid offers.



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