Stashing away money for med school

[Birdnals]

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I'm a nontrad who currently works and hoping to matriculate in 2015. I'm currently saving to help cover the costs of applying to school and also for living expense money during my time in school as I'd like to minimize the amount of loans I have to take out. I don't feel safe though saving my money 1930's style under my mattress, plus the mattress pays lousy interest.

I plan on opening a small account and investing a portion of my money in index funds and money market accounts. My question is how will this affect my getting financial aid when I go to apply for med school? There's no way I'll be able to save enough to live off of for 4 years so I'm wondering how me having a couple tens of thousands in the bank is going to affect the financial aid that's available. I should also note that a large portion of my income is under the table.

Hopefully someone else here has been through something similar or has a better idea than I do on how this process works. Thanks everyone!

 

[Yazo]

As you said, since most of your income is from under the table, then when applying for financial aid they're going to be looking at the income you get with the actual check. Like your real job. If that number of $ is low, then I don't think your account will be a problem as I'm sure you won't have THAT much on it. 🙂
So you're fine with the financial aid.

 

[galaxyx]

I was looking at the fafsa and it doesn't look like you have to report money in an IRA, but if you have a roth IRA, you can take out the money for educational expenses without penalty. This wouldn't help you the year you apply because this is still reported as income, but any savings from previous years wouldn't have to be reported. You are limited to how much you can contribute, but if you haven't done so already, you can contribute for 2012 until April 15th.
So you could shelter about $10000 (2012,2013) contributions. Since as a student 20% of your assets is usually counted for education contributions this could potentially save you a couple thousand dollars.
but you have to have at least the amount of taxable income that you contribute for that year. So to put $5000 in an ira, you need to report at least $5000 of taxable income.