Supporting Education: A Guide to Scholarships for Donors

Education is a foundational force for individual personal growth and high-level societal progress—it allows people to accomplish their own goals while strengthening their communities. Education can transform communities through innovation and economic amplification, but if you’re interested in supporting education through scholarship funds, you probably already know these things.
Despite the known transformative power of investment in education, the sector at large faces massive challenges in funding and the rising costs of quality education present barriers to entry for an increasing amount of students.
This is where scholarships become a vital lifeline. By reducing financial barriers and providing clear-cut incentives, scholarships enable students of all ages to pursue higher education and unlock opportunities that would otherwise be out of reach.
In this guide, we’ll explore the role of scholarships in supporting education and discuss how donors can get involved in making real change in their communities. If you’re interested in starting a scholarship fund with the help of Greater Houston Community Foundation, you can get in touch with us today at 713-333-2210.
Key Insights
- Scholarships reduce barriers to access to higher education, create opportunities for students, and drive progress.
- Scholarships can be merit-based, need-based, targeted at a specific field or demographic, and take the shape of small or large programs.
- Donors can make a lasting impact through one-time donations, donations to endowments, or ongoing contributions, which can make for essential long-term support.
- Scholarships promote economic growth by supporting students across many focus areas, increasing access to higher education.
- Organizations like Greater Houston Community Foundation, provide scholarship management services to help donors manage the complexity of structuring and administering scholarship funds, and maximize impact.
Table of Contents
- Why support education?
- Understanding scholarships
- Types of scholarship programs
- The impact of scholarship programs
- How donors can get involved
- Funding options for donors
- Structuring your scholarship
- Partner with Greater Houston Community Foundation to manage your scholarship
Why should I support education?
Quality education equips people with the skills they need not only to pursue the jobs for which they have the greatest acuity but also to contribute meaningfully to society. Bright futures and unlocked opportunities do not impact just one individual—or even one family—they encourage the spread of knowledge and resources throughout entire communities.
In Greater Houston alone, the impact of scholarships is profound. Greater Houston Community Foundation administers a range of diverse scholarship programs, granting over $5.7 million annually to over 1,000 students. With more than 60 different scholarship programs available, each tailored to specific eligibility requirements, these funds open doors for students based on factors like employment, field of study, or the high school or college they attend. By supporting initiatives like these, donors can profoundly influence the lives of students and their communities.
Understanding scholarships: What is support in education?
A scholarship is a financial award provided to students to support their higher education. Scholarships are one of the most effective tools for reducing financial burdens for students because, unlike loans, they do not need to be repaid. Scholarships are often merit-based, need-based, or targeted toward specific groups of students—but more on that later.
What’s the difference between scholarships and grants?
While scholarships and grants are both forms of financial aid that do not require repayment, they differ significantly in their criteria. Scholarships often focus on academic achievement, extracurricular activities, and field of study, while grants are usually need-based and awarded to students to attenuate financial hardships.
Loans, in contrast, must be repaid with interest, often leaving students in significant debt after graduation. By funding scholarships, donors can provide a sustainable and debt-free path to education for deserving students and possibly allow them an opportunity to avoid taking on student loan debt.
Types of scholarship programs
Scholarships come in various forms, each designed to address specific needs or goals. The three most popular scholarship structures are merit-based, need-based, and targeted scholarship programs. Here are some important notes about the different types of scholarship structures.
- Merit-based scholarships. Merit-based scholarships reward students for their academic performance, leadership, or talents in athletics or the arts.
- Need-based scholarships. Need-based scholarships focus on providing financial support to students from low-income families.
- Targeted scholarships. Targeted scholarships are designed for specific groups or fields of study, aimed at addressing gaps in education or workforce development. Some popular focus areas for these scholarships include students studying STEM, first-generation college students, and individuals pursuing non-doctorate careers in healthcare.
- Small vs. large scholarship programs. Small scholarship programs usually focus on a local community, while larger programs (usually backed by organizations or foundations) provide for a broad pool of applicants. Both small and large programs play an essential role in support for education systems.
How scholarships impact individuals and education systems
Scholarship programs provide more than just financial aid; they provide an investment in the future. Scholarship statistics from a recent study from MIT show that scholarships not only allow more students to finish college loan-free but also:
- Boost overall enrollment in postsecondary education
- Allow more students with below-average ACT scores to attend four-year universities
- Increase the chances that a student will complete their bachelor’s degree
- Increase bachelor’s degree completion rates for historically disadvantaged students
Access to education is a larger social issue. Scholarships provide many students with opportunities and an infusion of resources that can be incredibly far-reaching. By allowing more students (from more backgrounds) to access higher education, scholarships can contribute significantly to economic growth.
How donors can begin supporting education in the United States
Before establishing a scholarship fund, think about your goals as a donor. Consider the type of impact you’d like to make. Would you be more interested in supporting first-generation college students or making an investment in a field of study close to your heart?
As you think about the impact you want to achieve, collaborating with a scholarship management organization can significantly enhance your efforts. Greater Houston Community Foundation is here to help you strengthen and refine your scholarship initiatives, ensuring that you maximize the effectiveness of your philanthropic contributions. We can assist you in defining your ideal student profile and establishing and administering your fund.
Those looking to deepen their philanthropic financial planning or are curious about tax strategies for charitable giving can often benefit greatly from giving through scholarship funds, making a difference in the communities they care about the most while also enjoying the tax benefits of giving.
Read impact stories about Greater Houston Community Foundation scholarships:
How should you set up a scholarship? Funding options for donors
Looking to set up scholarships in Houston? You have a few options for funding, but will most likely be making either one-time donations or donations to endowments.
- One-time donations provide immediate support to specific students but only do so one time.
- Creating an endowment to generate ongoing income, can help ensure that scholarships are awarded for years to come, creating a lasting legacy.
- Establish a fund with a initial contribution and grow it over time, tailored to your unique philanthropic vision and investment capabilities.
Pledging ongoing support and committing to multi-year funding can enhance the stability of any scholarship program. Long-term support for ongoing programs can create essential infrastructure so that future students can look forward to higher education.
Structural options for creating a scholarship fund
If you’re wondering how to start a scholarship fund and you’ve decided who you’d like to support, there are still decisions to make about structuring your fund. A few structural elements you’ll have to consider include:
- Setting eligibility criteria. Establishing clear eligibility criteria will make sure your scholarship aligns with your goals. The Foundation provides expert advice to help donors set criteria that reflect their values while adhering to IRS regulations.
- Determining award amounts. Effective scholarship amounts should balance meaningful support with the program’s sustainability. The Foundation can help donors determine appropriate award sizes based on tuition costs, the number of scholarship recipients, and other important factors.
- Creating guidelines on applications and selection. Creating a fair and inclusive application process is essential—and often more difficult than expected. The Foundation manages all aspects of the scholarship process, from developing an online application to reviewing, scoring, and selecting recipients. Our team offers expert advice to ensure that your scholarship is awarded to the type of student who aligns with your values while utilizing industry best practices to keep your fund in alignment with IRS rules and regulations.
A soundly structured scholarship program means donors and supporters of the programs can stay in compliance and focus on what matters most: the impact of their contributions.
Looking for a scholarship management organization? Greater Houston Community Foundation is waiting.
Are you ready to create a lasting impact in the field of education? Whether you’re looking to establish a scholarship fund or contribute to donor advised funds, the Greater Houston Community Foundation offers an invaluable partnership to donors dedicated to supporting education.
By founding and supporting scholarships, you have the opportunity to shape the future, empower countless students, and create a legacy in your community. Your contributions can help open doors to educational opportunities that transform lives and inspire generations to come.
If you’re eager to start making a difference today, we invite you to establish a scholarship fund with Greater Houston Community Foundation. Our experienced team will provide you with the guidance and support you need to turn your vision into reality. Together, we can work toward a brighter future for students in our community.
Don’t wait to make a change that truly matters. Call us at 713-333-2210 or reach out directly to discuss how you can begin your journey of giving. Let’s create opportunities and pave the way for tomorrow’s leaders together.
More Helpful Articles by Greater Houston Community Foundation:
- What’s the Difference Between a Designated Fund vs. a Field-of-Interest Fund?
- Understanding DAFs: A Comprehensive Guide for Nonprofits
- The Power of Collective Giving
- Tax Strategies for Charitable Giving
- How Charitable Giving Can Enhance Your Legacy Planning
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