I'm 19 with $80000

[Goldy]

After your loans are paid I would seriously consider funding a Roth IRA if you are able to. You can only fund as much as you make in a year up to $5,500 but if you do that for one year and assume an 8% growth by the time you retire it will be worth ~214k. The sooner you start saving for retirement the easier it is to retire and I cant see you looking back and ever thinking that was a bad choice.

[SeanH]

(1) You might consider contacting your school and finding out if there is any sort of discount for pre-paying or if its possible to lock in and avoid future cost increases.
(2) I'm sort of curious if the $65K includes cost of living or if that's strictly tuition.
(3) I don't think it would change your strategy much and I did sort of skim at the end - but this $80K is a one time event right? Your investing strategy could be different if you knew you were going to receive something like this again in a few years.

[Spaidenbeta]

Yes that is how I plan to spend my money. Also since I don't have to pay for next years tuition now should I put it in a savings account until I use it? This also a one time thing only. And the 65k covers everything for the next 2 years not just tuition.

[97guns]

im a total minority here, against putting anything into an ira. sure you'll save taxes but you will be waiting 40 years before the money can be drawn tax free and put to use. imo these funds will be needed much sooner than that.

[disneysteve]

im a total minority here, against putting anything into an ira. sure you'll save taxes but you will be waiting 40 years before the money can be drawn tax free

Not if it is a Roth IRA. Contributions made to a Roth can be withdrawn at any time without penalty. I don't advise doing so but the possibility does exist if something catastrophic were to happen and you really needed that money.

[nyczarnold27]

What if one wants to retire before the age of 59.5? IRA then won't be a viable option right?

[feh]

What if one wants to retire before the age of 59.5? IRA then won't be a viable option right?

You could withdraw from a traditional IRA before 59.5, but there would be a penalty. Contributions (not capital gains or dividends) can be withdrawn from a Roth IRA without penalty.

But, if somebody really wants to retire early, they should have other savings or a taxable investment account to draw from.

[nyczarnold27]

You could withdraw from a traditional IRA before 59.5, but there would be a penalty. Contributions (not capital gains or dividends) can be withdrawn from a Roth IRA without penalty.

But, if somebody really wants to retire early, they should have other savings or a taxable investment account to draw from.

Can i still contribute to an IRA account if i'm living overseas and once i turn 59.5 years old, be able to cash out from another country? I'm planning on moving to another country once I retire before the age of 59.5

[feh]

Can i still contribute to an IRA account if i'm living overseas and once i turn 59.5 years old, be able to cash out from another country? I'm planning on moving to another country once I retire before the age of 59.5

Sorry, I don't know the answer to that question.

[willuc8]

Forex or options?

[elessar78]

advice here is great. But make sure to build your own base of personal finance knowledge. Read a bunch of different books on the topic, good suggestions abound on this board, otherwise how do you know if the advice is good and/or suits your situation and goals?

This place is a good sounding board for ideas, gain general knowledge, and fill holes in your knowledge base but I don't think it's complete.

Buy yourself some time and put the money somewhere safe while you learn how to manage this windfall. Maybe even consider protecting it from yourself? It's easy to piss away money.

[dojo]

1. You have a 30k loan. Pay it.
2. 'park' the money needed for the rest of your college time.
3. have an emergency fund.
4. what's left is money to 'invest'.

Even if you don't have too much left for investments, at least you graduate DEBT FREE which is something most students can't do. You already have an excellent start in life

[stoney508]

Student loans are killer I had 35k work and the payments for the general payment plan was close to 700 a month or more I in total had a monthly payment of 1,100 when I got my first job out of college 2 years ago. Looking back if I had 80k or even 40k I would pay off my Student loans in a heart beat fund an IRA or ROTH and boost my EF so that all my wages from then on could go towards my 401(k)/ retirement vehicle (15%) then fund a ROTH for next year (5500) and the rest for down payment on a house or vehicle. If those were gone I would have had a house and probably making income from it because being young I would have created an income suit or bought a duplex that could be converted into single family if I wanted to.

[MatthewC]

Hi there Spaidenbeta,

Here is my view on your situation : It depends on what you decide to do.

From a mathematical standpoint, if you make the same amount of money investing as you pay in interest (balancing out post-taxes), you're breaking even. If you make more, you've made money. If you make less, you've lost money.

Personally, if I were in your situation, I would invest it all. From my perspective from the retirement plan I created, it would take me about 25-30 years to retire comfortably without worrying about money if I started with that much. But that's me, not you.

For you, you have to ask yourself how your emotions will be affected. Most people are bad investors. Why? That they let their emotions affect their investing is part of it. Just thinking about investing it all seems to make you nervous. Investing outside your comfort zone leads worse results. Why? Because even if you get good or great investing advice, it is worthless if you can't follow it. And people who can't stick with a plan don't really have a plan.

So you have to ask yourself what you are willing to do to get to where you want to get to. Can you stand paying those student loans off later on a monthly basis if it will help you to get to a secure retirement sooner? Do you have a plan that will get you where you want to go? Can you stick to that plan?

Now if you have no plan, can't get a good plan, and simply want to feel more stable emotionally, you might just want to pay those loans off now.