My parents are giving me a good chunk of change as a present for graduating from graduate school. I am trying to figure out if it would be better to pay that towards the first years cost of attendance, or invest the money and use Staffords to pay for school. If I used this money I could pay for all of the cost of attendance as long as I took out the $8500 in unsub Staffords. However, that seems like a real waste of money considering the fact that the interest on my Medloans will only be 6.5% of simple interest, as opposed to compounding interest. The real issue is that I am weary of putting money into the market right now, and I am definitely not going into real estate. Is there any safe way to beat 6.5%? Actually it could be a little lower due to the compounding issue. I can't find any money market accounts that pay over 5.5%. Any of you financial gurus have any ideas?