Types of Financial Aid for College

Get the right financial aid information to help you make the best choice

The American dream has long depended upon opening the doors of opportunity to allow as many students as possible to attend college and other post-secondary educational institutions. Many types of financial aid have been created to help accomplish the task. These sources range from scholarships and grants on the one hand (free money) to loans (public and private) on the other hand.

But generally speaking, there are about a half-dozen main types of financial aid. Some are need-based—that is, awarded based on your family's income—while others are not.

Primary types of financial aid include:


These are cash awards to support a student's education, and are based on any number of factors, from academic merit, a particular skill such as athletics or music, or some other unique characteristic. Billions of dollars of scholarships are available each year from civic and faith organizations, employers and other sources. Use our scholarship search to find available scholarships.


This is money awarded to students, generally based on financial need, and does not have to be repaid. It typically comes from federal or state sources, and includes such things as the Federal Pell Grant and the Federal Supplemental Educational Opportunity Grant. You can apply for these grants online through the FAFSA process.

State aid

Awarded to state residents who plan to attend a school in that state. Check with your state's department of education and your guidance counselor on available student aid programs.


This program offers the opportunity for students to earn money for their education through jobs on-campus or nearby. Work-study jobs are awarded based on financial need.

Federal loans

These include the Federal Perkins Loan, Federal Stafford Loans (subsidized and unsubsidized, depending on financial need) and Federal PLUS Loans for parents and graduate students. Again, you apply for this kind of aid through the FAFSA process.

Private student loans

Also known as alternative loans, this type of financial aid assistance is arranged through banks and credit unions. Undergraduates typically will need a cosigner.

We recommend you should always exhaust grants, scholarships and your federal loan options before turning your attention to securing private loans. Why? Because grants and scholarships are free money and federal loans almost always come with lower interest rates, and other attractive terms. That generally remains true whether you qualify for subsidized federal loans or not.

Find additional financial aid information from Citizens Bank

Learn about additional student borrowing options to help you pursue your educational goals with the help of Citizens Bank. You can find useful information about our affordable TruFit Student Loan™ and get convenient student banking accounts. If you still have questions, call a student loan specialist at 1-800-708-6684, and we'll help walk you through the process.

Additional student loan and college planning resources

Investment in an Education
What Are the Differences Between Loans, Scholarships and Grants?
How Do I Pay for My College Education?
What is the FAFSA?
Have a Question?
Banking For Students
Student Borrowing
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