A good short term investment??

[mom-from-missouri]

My daughter will be getting a sum of $10,000 a year for 6 years starting this summer. It is for her college. But, the tuition will not be due for another month for the first semester, and then not until Jan for the next semester. It is coming from an annuity fund.

What is a good way to store it until we write the checks?? And, what if we don't need it? What would be a good way to invest it then?? She is a straight A student and already has several scholarships, and still has another year of high school to go, in which she can earn more scholarships. (she is doing her last year of high school along with her first year of college starting this August). The classes she will be taking in August, she only has to pay 1/4 the rate of tuition for (about $100 per class, taking 4 classes each semester), so for this year I'd rather invest it. She is only 16, but this is her money from a settlement years ago.

[cooliemae]

The question I have is whether you feel the total cost of tuition the following years is going to be more then then 10k. If the 10k is overkill for her college expenses, then I would take the excess and go ahead and invest it for the long term. If your daughter is working, I would look at opening up a Roth IRA and maximize the contribution to it. You might need to take into account the tax implications of the the 10k as well.

I'm not sure what you mean by short-term. If you're looking for something to put the money in for less than a year, there's really not much out there.

One thing I would suggest doing if possible would be to pay the tuition with a credit card has some sort of cashback award and then of course paying the balance off at the end of the month.

[mom-from-missouri]

Right now, she is planning on being a RN. But, she may change to premed or flight nurse. If she does that, we may need to access that money for the 2 - 6 extra years of schooling. So, I don't want to tie that money up in a long term investment.

Also, if she doesn't need it for school, she may opt to buy a house. How cool would that be--no student loans when she enters the workforce and a paid for house and car right off the bat. Then, she could invest a good chunk of her earnings for retirement.

She will be entering college with 1 1/2 yrs of classes already down, as she has been taking some already, and will be doing dual credit next year (her last year of college).

[scottgriffin]

Online Sales

Good investments that I have found have been online with websites. Selling things online can be a great ROI and residual income.

[parafly]

One potential solution is to use a combination of an online savings account and CD's. This strategy will give you a guaranteed return with no risk of losing any of your money in case of a decreasing market.

Right now, you should be able to get an online savings account paying about 0.8% interest and a 1 year CD paying about 1.6% interest. Money can be transferred from an online savings account into your checking account in about 2 business days.

Year 1
10,000 in online savings
50,000 in 1 year CD

Year 2
10,000 in online savings
40,000 in 1 year CD

... and so on.

[~bs]

this forum gets some pretty strange bots or something coming through.

[Joan.of.the.Arch]

MfMO, MidAmerica Bank in Rolla, MO is offering 3.05% on checking on up to 25K. Must be there in person to open. There are some account usage terms, but it is worth it to me to make a trip to Rolla next week. Maybe I'll see your daughter there.

This bank has branches in other towns. Maybe one is closer to you than Rolla.

And how could I forget? First Community National Bank out of Cuba, MO (branches elsewhere) has 4.01% on up $10,000.

[Byron T.]

Alternative View

You might consider purchasing precious metals from a reputable dealer in your area. Gold has increased in price 52% over the last five years, a fact that the mainstream media doesn't mention in it's recent "the price of gold is falling!" headlines.

You can always cash in your metals when you need to. And if you hold them, the value is very likely to increase over the long haul.

Something to think about.

[lewiskelly]

It depends on you what kind of investment do you want?) Bank fixed deposits: Invest in top bank fixed deposits for short term to get higher return.There are various corporate companies which are offering fixed deposits / Non-convertible debentures (NCD) with attractive interest rates.

[Esozh]

I would encourage putting the available funds in a Roth for her. She can always withdraw the initial investment with NO penalties or deductions, so long as she leaves the gain. The remaining $4,500 a year, it would seem prudent to put into cash savings, given the potential need.