5 Merit-based financial aid – Merit-based financial aid is given to students whohaveoutstandingabilities,talents,and/orachievements.Whenawarding merit-based aid (scholarships), the family’s financial situation is not taken into consideration. The award is based entirely on the student’s merit. Colleges give merit-based awards to encourage outstanding students to at- tend their school. Organizations and corporations award merit-based aid as a way to recognize outstanding achievement. Need and merit-based financial aid – Some finan- cial aid awards take both need and merit into consid- eration. For example, a scholarship may require that an applicant have financial needanda certain grade point average. The organization or college making the award determines to what extent an award is need-based or merit-based. FAFSA (Free Application for Federal Student Aid) Students and parents must complete a FAFSA in order to be eligible to receiveanyfinancialaidprovidedbythefederalgovernment.Statesand colleges also use information from the FAFSA to determine eligibility for state and institutional aid. Because need-based financial aid is awarded to students whose families need help paying for college, having a fair and objective way to determine how much a family can afford is very important. The FAFSA is the federal form that’s used to determine the amount a family should be able to pay. Parents should complete the FAFSA even if they think they’re not eligible for need-based aid. They may find that they are indeed eligible, and some programs want documentation showing that a student is not eligible for need-based aid before they award their merit-based aid. It doesn’t matter how many schools a student is applying to, parents and students only need to complete one FAFSA. Applying for college admissions and applying for financial aid are two distinct processes. Students must complete separate admissions and financial aid applications.