Tips from a Scholarship Whiz

This expert says start early (real early), don't stop looking for free money even if you're already enrolled, and knock on every door

Ben Kaplan graduated magna cum laude with a degree in economics from Harvard University in 1999 -- without any student debt. How did he manage that? As a junior in high school, he began scouting, applying for, and winning dozens of scholarships, which financed almost his entire education. In a little over a year, he had won $90,000 to pay for college.

Now his goal is to help other students do the same. Kaplan, 27, is the founder of, an online counseling service based in Portland, Ore., that offers advice on financing higher education. A bestselling author, he has written 12 books, including the most recent How to Go to College Almost for Free: 10 Days to Scholarship Success ( Publishers, 2004).

Kaplan recently spoke with BusinessWeek Online reporter Francesca Di Meglio. Here are edited excerpts of their conversation:

Q: How early do you need to start thinking about financing higher education?


If I could do this all over again, I would actually start as early as seventh or eighth grade. In reality, I didn't begin until the end of my junior year in high school. When you start earlier, you'll find programs for younger kids that have scholarship money attached.

For example, you might do a science or history project, send in your results to a group [holding some sort of competition], and get money in the form of a $1,000 U.S. savings bond. Plus, when you start early, you can position and prepare yourself better. You say, "Hey, they're going to ask me this essay question three years from now. What types of experiences might help me answer that?"

But it's never too late to start. Once you get into college, in fact, a whole new class of scholarships becomes available as you choose an academic major or career path. For those entering graduate school, there are different awards based on things like the type of research you might be doing.

There are also groups that target lifelong learners or adults who might be returning to get a degree after being in the workforce for a while. For example, Talbots (TLB ), the women's clothing store, awards 55 different scholarships each year for women who have been out of school at least 10 years and want to return.

Q: What can parents of young children do to save for college?


Over the past decade, the average increase in college costs has averaged around 6% per year, so taking steps early to save money for college is really important. Investing in a 529 college savings plan is a great way to set aside money. Earnings build up on a tax-deferred basis, interest compounds over time, and you can use the money tax-free for qualified college costs.

The key to maximizing the impact of tax-deferred, compounding interest is giving it enough time to grow, which is why you should start saving as soon as possible. It can pay huge dividends later.

Q: What's your No. 1 piece of advice for financing higher education?


There are millions of dollars awarded every year from corporations, foundations, associations, industry groups, and individual schools. But they don't come knocking on your door. You have to knock on theirs. It's up to you to find out about all sorts of help -– from the opportunity to earn credits for college by taking certain standardized tests, like Advanced Placement or International Baccalaureate exams, to financial aid offered by individual institutions.

Q: What's the biggest mistake people make in paying for college?


One huge mistake people make is that they apply for one or two scholarships and then they stop. That's a huge mistake because your first one or two scholarship applications are the hardest ones you'll ever do. The reason is that you've never done this before, and you don't have any recyclable materials on which to draw. Once you've applied for one or two, you've already done 60% of the work to apply for 10.

Q: Is it a myth that you have to be supersmart or athletic to win money for school?


The first scholarship I won required applicants to have a 2.75 GPA [grade point average]. But once you met that minimum bar, the judges didn't look at your grades at all. So, you could have a 2.76 or a 3.9, and it wouldn't make a difference.

Sometimes, students with really high GPAs have trouble filling out scholarship applications because they tend to rely on their scores alone, and that's not enough. Show how you demonstrated leadership within a club, rather than just listing your affiliation. You want to paint a portrait of who you are, not just what you've done. You do that by making your applications intensely personal and as unique as possible. That helps to make an emotional connection with scholarship judges. They award scholarships to people, not to résumés.

Q: What pitfalls should people avoid when taking out loans?


Most parents and students pick a lender from their college's preferred lender list. Those lenders don't necessarily offer the best deal to students. They're just the ones that are the easiest for the college to manage, because the partnership allows them to process the paperwork more effectively. That's why it pays to shop around for student loans, rather than just picking one from the preferred list.

Also, consider a lender that offers repayment benefits. Some lenders will reduce your loan interest rate a point or two after you have made consecutive, on-time payments. Others will reduce it another quarter-point if you agree to make an electronic-funds transfer directly from your bank account each month. Make a plan to pay more than the minimum amount each month, because there are no prepayment penalties with student loans. Over time, this saves a significant amount of money.

Q: What's your philosophy on paying for higher education?


Paying for college is a game. There are certain rules, principles, and strategies of this game that can be learned. Talk to other students and families in your community who have already been through this. Look at winning applications to see what works. The best way to master the game is to learn from those who play it well.

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