Setting up a scholarship is not as hard a task as it seems. You can set up a scholarship fund within a week in a few easy steps that I will share. You can do most of these steps on your own, but it’s easiest to work with a trusted scholarship management service, which will help you avoid costly mistakes in the process.
Some people might wonder if giving out scholarships are worth it. It definitely is, because you are helping a lot of people in need and also gathering a lot of good karma for yourself in the process too.
- 1 Easy Steps on How to Start a Scholarship Fund
- 2 Frequently Asked Questions about Easy Steps on How to Start a Scholarship Fund
Easy Steps on How to Start a Scholarship Fund
Below are the Easy Steps to Start a Scholarship Funding Program.
1. Decide who will get the Scholarship
When starting a scholarship fund, the very first thing you need to consider is who you plan to award the scholarship to. You can consider different criteria like a high school scholarship, university scholarship, or even athletic scholarships you can also bring into consideration scholarships for a given gender, race, financial need, extracurricular activities, religion, etc. Also, you will need to have a standard by which you judge qualifications. For example, if it is an academic scholarship, the standard could be awarding scholarships to academically outstanding students or maybe those that are financially incapable of paying tuition, etc. It is important to create a standard so those who meet the standard can be considered for the scholarship.
2. Create a budget
Creating a budget is the next step and when doing so, you should ask yourself “How much money do I want to give and how often do I want to give it” “how many people do I plan to sponsor”. These are important questions you should ask and when you have gotten the answer you will be able to determine your budget. Keep in mind that if you set up a scholarship correctly, all of your donations are tax-deductible. You can also increase your grant by sharing it with friends, family members, and your network. There are platforms that make it very easy for people to donate.
3. Fund the program
Getting the money for the scholarship is very important cause you do not plan to have a scholarship program that does not actually pay! do you? And you do not plan on stealing from the bank to fund a scholarship program. Funding the scholarship is often the most difficult part to decide when figuring out how to start a scholarship fund, but there are different ways one can fund a scholarship program. One of the most common ways to raise money for your scholarship is to get people to donate to it. This can be done through fundraising events or online crowdfunding sites. Otherwise, if your company is hosting a scholarship, you can set aside a specific number of funds each year. Or if you’re creating a memorial scholarship, perhaps personal funds can be used to fund the scholarship program.
4. Set a deadline
After funding the scholarship program, you should set a deadline for the application of the scholarship. It is advisable to keep your scholarship open for 3-6 months to ensure that you allow students the time to apply and have a competitive applicant pool. Many people wonder if they should award scholarships during a specific time of the year to align with when students are paying tuition. The reality is that students apply for scholarships and grants all year round, and there is no perfect time for awarding the funds. So you can pick any date be it winter or summer.
5. Advertise your program
Advertising your scholarship program is the next step. Imagine having a scholarship program that nobody knows about? That would be a waste of effort. You should promote your program and you can do so in so many ways. One of the fastest ways to advertise is to post online on any scholarship site so students can see it and apply. If it is a local scholarship, you can meet any of the city chiefs or even the school’s principal and tell him about it who in turn will broadcast it to the students. The interested participant will therefore apply for your scholarship program.
6. Select the winners
You can review all the applicants based on the criteria you have put in and grade them. At the end of it all, you select the best candidates for the scholarship. Those who qualify should be notified by email that they have been granted a scholarship.
7. Awarded the scholarship
After the winners have been selected and notified, you award them the promised aid. You can also place certain restrictions and determine how the money should be spent. Scholarships must be used for educational expenses. It is a good idea to disburse your scholarship funds to the school and not the student.
8. Review Tax Guidelines
Keep in mind that many scholarships are tax-deductible, so it’s a great idea to meet with a tax expert beforehand to make sure that you meet all the requirements.
Frequently Asked Questions about Easy Steps on How to Start a Scholarship Fund
i. How much does it cost to start a scholarship fund?
You usually need about $20,000 to $25,000 to endow a scholarship that pays out $1,000 every year. The requirements vary by organization
ii. Can anyone start a scholarship fund?
Anyone can establish a scholarship, or scholarship program, for higher education. As previously stated, creating a nonprofit organization to give scholarships for higher education is not necessary. However, there may be tax implications for both the scholarship provider and the scholarship recipients.