How Should I Invest My Savings? – Mike

“Dear Paul,

Hello, Im a college student with $18,000 in savings. I need to know what to do with it both long and short term. They only debt I have consists of student loans. I have no credit card debt.


Hi Mike,

First off; nice job saving up funds, you are the exception rather than the rule, particularly for a college student!

Student loans usually come with low interest rates and favorable repayment terms; if that is the case with your loans, then determine how much cash you should have on hand for emergencies (generally 3-6 months-worth of expenses). Then with the balance, I would set up a well-diversified account with a discount brokerage firm, like Schwab for example. You should invest in a few funds (no-loads or ETFs) in broad baskets (US stocks, International Stocks and Emerging Markets) as a start. The money you need on a shorter term basis should simply be put into a money market account that pays a little interest (the goal here is liquidity not making returns). Hope this helps.

Mr. Bennett is a Certified Financial Planner™ professional (CFP®), Chartered Financial Consultant (ChFC®), Accredited Investment Fiduciary™ (AIF®) and Managing Partner of c5 Wealth Management, LLC. He holds a Master of Science in Finance (MSF) with Honors from Indiana University – Kelley School of Business and a BA from the University of Florida. He is currently pursuing his PhD in Economics from SMC University. Mr. Bennett has completed the Advest Institute’s advanced program on portfolio analytics and behavioral finance at Harvard University.

He was recently recognized by Washingtonian Magazine as a Top Financial Advisor and Kiplinger’s Personal Finance Magazine, the Journal of Accountancy and the American Bar Association Journal as Who’s Who of Virginia Certified Financial Planner™ professionals. In addition, he has also been recently selected by the Consumers’ Research Council of America as one of “America’s Best Financial Planners”. He is a current contributor to the Rydex Advisor Benchmarking Index. He is quoted often in the press, has been featured on and has contributed to various publications such as U.S. News and World Report,, Advisor Today, Dow Jones News, Financial Advisor Magazine, Financial Planning Magazine, Investment News, The Washington Business Journal and The Washington Times.

If you have a questions about investing, financial planning, retirement, entrepreneurship, executive benefits and insurance (life, disability, long-term care, etc.) you’d like for Paul to answer, just use the online form. The help is free.

Leave a Comment