Hello. I'm 17 and a senior in high school. I started a job during the summer and still continuing it. I have roughly $1,000 saved up as I used most of my money on clothes and things that I need. My goal is to attend a private university that is about $70,000 before scholarships. I don't have a car and my family is considered low-income. Any advice on saving/investing?
$1,000 – what to do as a 17 year old
byu/robloxbestplay2468 inpersonalfinance
Posted by robloxbestplay2468
9 Comments
Is there any more affordable colleges in your area? $70,000 a year is a lot. Even if you get scholarships, you will likely end up still paying a decent chunk. Most people do not even make $70,000 in a whole year. Just something to think about. Maybe consider any other colleges in your area that are more affordable. Savings wise, open up an account called a High Yield Savings account. The app E*trade has a good one you can open. You can let that money sit in the account for a bit and gain interest.
Put your savings in a HYSA. Rates are a little down, but earning 4% for just keeping your money in an account is the safest idea for you financially. Make sure the bank you go with is FDIC insured.
I wouldn’t recommend stock market investing right now given the precarious nature of the economy and your need to use the funds in a year or so. There are currently more unemployed people than there are jobs, and a lot of people are fearing a recession sooner rather than later.
Frankly though, $1000 isn’t much. Assuming you’re still saving money from your current job while you’re in school, you probably will not have anywhere near what you’d need to comfortably attend your dream school unless you got a full scholarship. I would not recommend taking out student loans to go to the private university as you’ll spend decades of your life financially crippled paying them back. I would recommend taking a gap year after you graduate to save up more money and also maybe adjusting your goals and expectations to be a bit more realistic for your situation.
Unless there’s a very specific reason you want to go to that private university you’re dreaming about (maybe it’s got a better program for your desired major?), you should look into public state universities as the tuition would be more affordable. Most states also offer grants for low income students on top of whatever scholarships you can earn, so look into that as well.
I personally went to a public university in my state with tuition at ~$6k/yr, earned an $8000 scholarship from the school due to my ACT scores, earned an in-state scholarship that covered the full amount of my tuition due to grades, and also earned a grant for low income families because both of my parents were disabled. I got enough financial aid that my university was refunding me ~$5k a semester, which I was able to save up and use to buy a car after my sophomore year. Your mileage may vary, but those scholarships and grants will be very helpful if you can get them.
There is no meaningful investment that will not be losing value within the time frame you are going to need the money. So stash the money on a savings account. At most look at what rate the high yield savings account will give you and the rates you might get out of certificate of deposit for a duration of a year.
Nothing else probably makes sense. That money will evaporate instantly in college costs. So stash the cash.
I agree with the advice to not attend that private university unless you have a full ride scholarship. It’s easy to get emotionally attached to the idea of studying at a specific school and having a specific alma mater, but in most cases, you won’t really get a better education and won’t be better prepared for your career field, nor will you have much better job prospects because your degree is from a specific private school rather than a less prestigious public school. In most cases, the cost-benefit analysis tilts heavily toward attending a state school (and the community college option is also a good recommendation) and graduating with much less debt. You may even be able to avoid debt altogether by working while you’re in school, and then you’ll be WAY ahead compared to your situation if you graduated with $300K in debt.
Also make sure you choose a major that makes college a good investment to begin with. Consider what you intend to do with the degree and what income range you can inspect; compare it to the income range you could expect if you didn’t go to college and instead went into a trade. Don’t go to college just to make $35K/year. And definitely don’t take on $300K in debt (or even $150K in debt) just to make $35K/year.
What do you want to go to school for? In most cases, I think spending that much on school is unnecessary.
stash most of that $1,000 in a high yield savings account and leave it alone. You want it safe for deposits, books, or anything college related, not riding some sketchy investment. Definitely keep grinding at your job and budget carefully
Like everyone is saying, open a savings account. Work out a monthly budget. Figure out how much you’ll make a month, and how much you want to spend/save. Plan ahead for things like prom and Holidays.
if you are low income there is no world where you should be spending anything more than $10k a year on college (and that’s on the higher end) at any institution with half decent financial aid. no school worth going would not, at the very least, cover tuition.
keep that $1k in a savings account as your starter emergency fund. Don’t invest yet since you may need the cash soon for school or basics. Focus on applying for every scholarship you can and keep working part time to grow your savings. The big money move for you is keeping debt low when college hits.