How to Avoid Scholarship Scams
How to Avoid Scholarship Scams Scholarship scams are real and they are costing the next generation of learners, and their families, millions of dollars every year. By our estimations, these scams trick just under 2% of college students every year, but don’t let that seemingly insignificant figure fool you. There are more than 50 million college students in the US, which means that fewer than 2% equates to around 350,000 students every year.
These scams cost those students and the US economy in excess of $5 million a year. But there’s much more to it than that. Scholarship scams may stop a student from applying to the college they want to apply to; they may strip them of whatever savings they have, forcing them to take a part-time job instead of fulfilling their higher education goals.
They are damaging, life-changing and, unfortunately, they are also on the increase. It’s not all bad news though as scholarship scams are fairly easy to spot. It’s just a case of knowing what to look out for, as that way you can sense them coming and stay well clear before they get a chance to do you harm.
Common Scholarship Scams What follows is a number of popular scams currently doing the rounds. Actual scholarship scams come in many forms and may differ slightly to the scams described below.
Scholarship Lotteries There are scholarship programs out there that require a small fee, often no more than $50, and promise to pay out an amount of at least $1,000 to chosen applicants. These may seem reasonable, but that’s what they’re counting on. They’re hoping that you’ll hand over the money because it’s such a small amount and because the reward is so great. Many applicants do just that.
These scholarship programs have been known to pay out, but they typically release just 1 payment and by that point they have earned more than enough to be able to release that payment and remain in profit. If 100 applicants pay them $50 each then they will have $5,000, which means they can afford to release $1,000 and pocket the rest. It is not unheard of for these programs to get over 1,000 applications, which means their profits are considerably higher.
Even though the entrance fee seems very small, it’s just not worth it. They are glorified lotteries and nothing more. If you’re struggling to put together enough money to pay for your fees then you need all the money you can get. So, don’t throw it into the endless pit that are scholarship lotteries.
Any scheme that requires money upfront should be viewed with suspicion.