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Should I pay $500 for a personalized scholarship search?

QUESTION: My parents received a letter from a national financial aid organization that will conduct an in-depth search to find scholarships that fit me. The price is $500, but the organization guarantees that I will win scholarships worth at least $2,500. It seems like an offer that we can’t refuse. Do you think we should pay the money?
–Guaranteed Winner

Dear Guaranteed Winner: Unfortunately, despite what the organization has promised, there’s no such thing as a guaranteed scholarship winner. You’ve encountered a classic scholarship scam. While the great majority of people who provide scholarships have benevolent intentions, there is a small minority who try to take advantage of students’ and parents’ fears about paying for college. According to the Federal Trade Commission, consumers were taken for $22 million by scholarship scams last year. Do not apply to a scholarship or use any financial aid services that:

  • Require a registration, entry, or administrative fee that is more than the cost of postage.

  • Solicit your credit card number.

  • Have no contact address or phone number.

  • Sound too good to be true.

  • Guarantee you’ll win.
These are all signs of scholarship or financial aid scams. If you read the small print on the agreement, you’ll probably find that you are not guaranteed to win $2,500 but that you are guaranteed to receive a listing of scholarships with values over $2,500. Get the same information for free on the Internet or for significantly less by buying a scholarship directory.

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Gen & Kelly Tanabe

Gen and Kelly Tanabe are the founders of SuperCollege and the award-winning authors of 11 books on college admission, financial aid and scholarships. Together they were accepted to all of the Ivy League colleges and won more than $100,000 in merit-based scholarships to graduate from Harvard debt-free.