<p>Hello,
Although this may seem an obvious question, I need to ask it to get people's opinions.</p>
<p>I currently have a checking account that fluctuates from $100-500 depending on what bills need to paid. I also currently receive financial aid for school.</p>
<p>Due to my circumstances I have devised a plan to save $10,000 in the next two years if i stick to a putting a certain amount of money that I earn in a savings account.</p>
<p>My question to anyone knowlegable on the subject, </p>
<p>If i plan to go to graduate school and am hoping for financial aid there, will i be screwing myself by building a strong bank account.</p>
<p>Man, how are you going to save 10K in two years? Shoot, what line of work are you in? </p>
<p>Oh, on the FAFSA, you have to be 100% honest. But, there are things you can place your money in where you can be ethical and not claim your savings. I forget what it is though, there is an old thread on that subject.</p>
<p>See, you can take you savings, if you want to, and put it in other things and whatnot. Or, you could give me your ten grand you are soon to make! I mean, the choice is yours, my friend!</p>
<ol>
<li> Student assets are hit at a higher rate for contribution toward education, so it is smart for parents to keep assets in their own names rather than transfer to student. But I'll argue against student transferring his money to parents. The first reason is ethical. To transfer it to your parents when you really intend for it to still be yours smells like a fraudulent transfer. That the finaid office doesn't have the means to discover it doesn't mean it's right. Also, if you give it to your parents, they can do whatever they want with it-- or their creditors might get it or their estate.</li>
<li> You can put some of it in an IRA. It won't count for finaid, but it also won't be as easy to get at if you need it.</li>
<li> Of course it's a good idea to save, even if it means less finaid. The finaid you lose could be loans. It's probably preferable to spend some of your savings over borrowing. And if you have a setback that forces you out of school for a while, you have something to fall back on.</li>
</ol>
<p>First of all, you know your parents better than anyone else - are they the type to save your money for you or steal it from you? If they can be trusted, having them save it for you in their name is - I think - best because their income will not be counted at the same percentage rate as yours - your income will be counted at a higher percentage rate as far as the financial aid goes. It's not "cheating", it's wise. </p>
<p>Second, an IRA can't be touched until retirement age without large financial penalties...enough to make the "saving" of it a waste. Don't do that unless you don't want to see that money again until retirement.</p>