after the loan disbursement

TexasCCRN · Jul 25, 2006

hey all, i just found out today that i was approved for my loan and disbursement will be sometime around august 1st.. it's a rather large amount and i was just wondering what others have done/will do with this money. should i add it to my checking account? or put it into a savings account to help offset my apr? i may run into a problem when i file next yr should i have to claim it.. or just cash it and keep a fat wad of rolled-up hundreds in my pocket? "why yes, it IS a large wad of money in my pants" - (bad humor, i know)
anyway, your thoughts appreciated

I just took what i didn't need and did a 6month CD. After 6 months i needed a bit of it so i took that out, then renewed the CD. Better to earn a little interest than to just let it sit there. Plus if you see that big amount in your bank account you won't realize sometimes that you are spending too much.

nia_king · Jul 26, 2006

Look into online savings accounts as well. They are paying up to 5.15% interest which is 1000 times more than you will get in any traditional savings account and on par with most CDs. They are all FDIC insured up to $100,000. They are great if you don't want your money handy... it takes about 1-2 weeks on average to transfer money between the online account and your linked checking account (they say 1-5 business days) so it is always a deterrent for me anytime I want to take money out. There are no penalties for withdrawing money, no fees whatsoever, and no minimum deposit or minimum amount you can have in your account. I think it's the best thing since sliced bread.

However if you think that's still easy access, then go with a CD where there are penalties for taking money out and you may get maybe up to a quarter more interest.

The online accounts are

Emmigrantdirect.com

HSBC.com

INGdirect.com

I think there might be more but those are the 3 I am familiar with and of course I use one of them currently to save for school. Look carefully at the fine print. Some of the advertised rates might be promotional in which case it reverts to a lower rate after a period of time. Look for one where the advertised rate is the one you get.

Again they are online accounts which means there are no branches, no ATMs etc, that's why they pay so much interest. They are for low-maintenance customers. Check it out and good luck to you.

kcwolf200 · Jul 26, 2006

I have been using INGDirect.com. I believe the interest rate is 4.35%. I put the whole amount in that savings account. It takes 2 business days for the money to transfer from the savings into my checking account. What I have done to ensure that I manage the money well is that every 2 weeks on my wife's payday, I transfer the money into checking (with a 2 day headstart). That way, most of the money keeps earning the high interest rate and I continue recieving a "paycheck", just from a different source. This method has worked well, since I have heard of people running out of money and having to obtain more loans. Plus, it is much easier to budget and keep track of than having a huge sum of money in your checking account.

dfk, RN, CRNA · Jul 26, 2006

I have been using INGDirect.com. I believe the interest rate is 4.35%. I put the whole amount in that savings account. It takes 2 business days for the money to transfer from the savings into my checking account. What I have done to ensure that I manage the money well is that every 2 weeks on my wife's payday, I transfer the money into checking (with a 2 day headstart). That way, most of the money keeps earning the high interest rate and I continue recieving a "paycheck", just from a different source. This method has worked well, since I have heard of people running out of money and having to obtain more loans. Plus, it is much easier to budget and keep track of than having a huge sum of money in your checking account.

good idea.. thanks wolf !

ih8neuro · Jul 29, 2006

What is the typical amount for the loan dispersments? Do they give you a check for the year or semester? Does interest start accumulating on the loans from when they are given out or when you graduate? I think a CD is the best way to go, they pay more interest than money market accounts. Bankrate.com shows all the highest yielding CD and MMA's.