If you have received a merit scholarship, first of all: congratulations! Now you may be wondering what exactly you can pay for with the scholarship money. That depends on two main factors: where the money is coming from, and in what form you will receive it.
Where the Money Comes From
In terms of absolute dollars, the vast majority of merit scholarships are provided by colleges directly. Private colleges, which are frequently endowed with scholarship programs funded by wealthy alumni, award more merit-based aid than public universities. If your merit scholarship is sponsored by your school, then the school will automatically apply your merit scholarship monies toward the cost of tuition. The remaining balance, if any, can be applied toward room and board, textbooks and school supplies, or other education-related expenses. Full-tuition scholarships, as their name implies, can only be applied toward the cost of tuition. Full-ride scholarships can pay for tuition in addition to other school-related expenses. (Full-tuition and full-ride scholarships may not be strictly merit-based, but rather awarded based on a combination of merit and financial need.) Every school sets it own policy for exactly how merit awards are paid out; many colleges simply withhold the cost of tuition and issue the remainder to the student in the form of a check or direct bank deposit.
Unlike college-sponsored merit scholarships, merit aid awarded by private sponsors is typically issued in full by way of a check or direct bank deposit. The expectation, of course, is that the money will be spent on education-related expenses including tuition, room and board, and other school fees. Strictly speaking, however, private scholarship sponsors do not normally stipulate how the scholarship money can be spent. Recipients are only obligated to remain in compliance with the requirements of the scholarship itself - which may mean staying in enrolled full-time in school or maintaining a certain minimum GPA.