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Why would applying to as many scholarships as possible reduce your student debt?

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Most scholarships provide financial/tuition aid. This means more of your tuition is paid out of the organization/government's pocket, versus out of your own. With no scholarships, you'd likely need to get a loan to fully pay off tuition; which would launch you into student debt. With partially paid off tuition, you don't need nearly as much money for tuition (but likely still need a loan), so this debt would be reduced by quite a bit.