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Investing while in school?
Started by Xeal0007
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I'm guessing you probably won't have much loan money left over after tuition, room and board, books, etc. are paid for. You also won't have a job, so you would be investing in a taxable account. Imo, it would be a better idea just to keep your loan amounts down since you are basically "investing" with a return of 6%-7%.
'tis true
Yes, keep your loans down to any extent you can, that's 6-7% in interest, plus there are usually disbursement fees on top of that. If you can work all summer and a few shifts per week during the year, you should be able to put yourself in a much better situation. I took enough loans to cover all but a few thousand of tuition, so living expenses and that last little bit I had to work for the money.
If for whatever reason you really want to invest, I guess you'll do pretty well with a Roth IRA since you'll be in a very low tax bracket and you'll have tax free growth. Limitation here is that you can only contribute salary earnings; you won't be able to not work and invest loan excess, although that wouldn't be wise anyway.
I contribute up to my employer's match for my 401k and put a smaller % of my paycheck towards employee stock purchase. If you work as an intern at a chain inquire if you have this option as a part-time employee.
I contribute 6% of my paycheck to 401K and my employer matches, and I buy about 50 in stock a pay periodI also have a Roth IRA which I contribute 50 a month too. This seems to be a good option for me since while I'm in school I still work a few shifts a week but I don't have to actively manage these funds. Unlike day trading etc.
If you know what you're doing in any way, go for it. I bought mutual funds back in 2011 during the Greek financial fiasco at 7 and they're hitting 20 now, with quarterly returns. That covers interest several fold for 10s of thousands for a few years, to say the least. If you have money, invest it but be careful.
