Study Abroad | Student Loans Vs Scholarships To Fund Your Dream Degree

A scholarship is a money-based award that is granted to successful applicants to pay their education-related expenses.

This can come in the form of a scholarship that pays for a semester of your university studies or in some cases, the entire duration of your programme!

A student loan on the other hand is money borrowed from a financial institution such as a bank or credit union. Eventually, you will have to pay it back with interest which could affect the decision of your major.

In this article, we will take you through the eligibility requirements, the key aspects for each and the most important considerations you need to know in order to make a well-informed decision!

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Scholarships:

Depending on your university, there are likely multiple types of scholarships that are available. These can be a general scholarship tied to a specific department or course of study or an excellence award that you can apply for.

There are also government scholarships such as the Vanier Canada Graduate Scholarship for students who show leadership skills, granting $50,000 per year for three years during their doctoral studies.

Additionally, there are also grants that you can apply for. They do not have to be repaid but they are based more on financial need and not merit, thus you will need to provide proof of your financial circumstances.

Depending on the particular type, scholarship applications will have to be done both before you select your university and during your school term itself. Our education counsellors can help guide you through the process.

Student Loan:

While student loans are generally more accessible, the application process is more about your creditworthiness and ability to pay back the loan after your graduate and start working.

Because it is more likely you don’t have a credit history yet, you will require to apply for a loan with a cosigner, commonly a parent, who will guarantee your loan. Many banks or institutions will have special rates for student loans but you will need to check each individual requirement before applying.

The good thing about a student loan is that you have the ability to borrow the entire amount of the money needed for your studies while a scholarship might only be partial.

Additionally, you can also go beyond that amount if you require more funds for other expenses including your cost of living or if you desire to travel around Canada as well - but be aware that you will need to pay it back!

You will receive the student loan in one lump sum, and that allows you the certainty of the funds and allows you to plan your expenses ahead. Now the cons come twofold, firstly, you will be tempted to utilise it for your own enjoyment and non-student related expenses, especially if you over-borrow just in case. Remember that you will have to pay it back eventually and there is an interest payment tagged onto it.

This could mean you might be working harder to pay it off and the pressure to get a job will rise.

Secondly, if you do not pay it and default, your co-signer will be liable to pay the loan.

Scholarships are rather straightforward. When you earn one, you get to keep the money you receive without any need to pay it back. Additionally, unless you are bonded to an exclusive scholarship, you can apply for as many as possible to fund your entire cost of study.

Additionally, you can list down the scholarship you earned in your resume which will act as a highlight of your university studies, helping you stand out during the job hunt!

However, scholarship applications are fierce and just because you put in your best effort through the process, which is often grueling and requires motivation letters and even interviews.

This means you will spend a lot of time filling out applications and typing scholarship essays and you might not clinch it. This would mean not having enough money and could even delay your enrolment to the following year.

Additionally, many scholarships also have requirements that are closely tied to your academic results if it is a merit-based scholarship. If you dip below a certain benchmark, you could expect your scholarship to be terminated together with your benefits.

Thinking of furthering your studies and pursuing a rewarding career in Canada?

We can help assist you with selecting the best colleges and cities to live and study in.

At IDP, we have an experienced and friendly team of education counsellors that can answer your questions and take you through the different universities and course application process.

Get started with a free counselling session today.

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