Scholarship entry fees

I have been asked several times over the past week or so about paying an entry fee for a scholarship.

This is a very touchy subject that gets lots of attention from school administrators and government officials. There is no right answer to the question and there are pros and cons to the situation.

First of all, there are legitimate scholarship granting companies that offer scholarships and don't charge an application fee. They are hard to find and you must do your research. There are also companies that charge an application fee to enter the scholarship contest and give tons of scholarships, as well as companies that charge and never give a single one.

Lets say you enter a scholarship contest where there is a $5 entry fee. The company says they are going to give out 5 $1000 scholarships. Well this is fine if only 1000 people or less enter the contest, but this is usually not the case. What happens if 10,000 students enter the contest? Looks like the company will make a hefty $45,000 profit for not really doing much.

I have found scholarships that do give 100% of the money from application fees back to students. Of course everyone who enters will not receive a scholarship.

There might also be issues with this type of scholarship being a lottery or game of chance. Those are generally illegal in the United States. This is why most companies require that you submit a scholarship essay of some sort. This takes away the element of chance in the contest.

Whether the application fee is $1 or $100, please conduct research on the company you are applying to. Also, you can always check the BBB in your state.