1. Enrolling in college as soon as possible, then trying to save as much as I can after graduation, living in a low rent place and being frugal
2. Postponing college for another year, working a full-time job or a full-time and a part-time both, then putting all of that money (since I have no current expenses, rent, etc.) into mutual funds and a Roth IRA, and letting it sit through my 4 to 8 years of college (until about age 40 or 45), adding at least ,000 a year after that (much more if I make more)
3. Postponing college for 2 more years instead of one, and putting between ,000 and ,000 into mutual funds, etc., and pulling out some of that for graduate or medical school if I end up going that route, then starting to invest mainly after graduation and residency, about 10 years from now
Which one is the smartest route, financially? Thanks.
I mean, step one does sound best to a lot of people. But I know that what you invest before 25 has a huge impact.
Joe 8:59 am on December 19, 2009
If you delay college one year, you delay earning the higher wages that a college education gives you. Let’s suppose after college, it takes 10 years to reach maximum salary in your profession. If you delay college by one year, you will spend one less year in your life earning the maximum salary. This loss will probably be more the money you make by investing early. I would suggest going to college as early as possible. When you graduate, start squirreling away as much money as you can.
Let’s take the extreme case: let’s suppose you delay college by 40 years and invest the money. Do you think you would end up with more money this way? Delaying college by 1 year is 1/40th as bad as delaying for 40 years, but it is still a bad idea.
ALBERT O 8:59 am on December 19, 2009
1 is best.
you need to have a degree & as a professional you can earn as much then apply all you mentioned in #s 2 & 3 about putting up investments.
that way you are a complete being for success
good luck
I_think$ 8:59 am on December 19, 2009
With your plans it sounds like you should work 2 years to build up your funds for college. The drawbacks are you may lose some study habits, skills, and knowledge; and it might be harder to get into grad or med school. Bucking others advice, I do not recommend tying up money when you are young and in low income years. Pay the tax*, and use the balance wisely (like college, or a house). I think you are underestimating the price of college, even if you are living expense free. The problem with the stock market is that your accounts could be down just at the time you need your funds, but to buy in or not is your call. *I know you pay the tax upfront on Roth IRA money, and I know Congress keeps making it easier to get your "permanently invested" retirement money out early; so if you can work those rules to your advantage, what can I say.
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