Personal Finance

Low risk student looking where invest

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  • May 29th, 2013 6:56 pm
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Sr. Member
May 24, 2013
716 posts
155 upvotes

Low risk student looking where invest

Hi all,

I am entering my fourth year of University. I am eligible for OSAP, which I have received every year. I have approximately 20k in the bank (PCF @1.5%), and was looking if you guys have any other recommendations of where to put my money.
22 replies
Deal Addict
Sep 19, 2009
2051 posts
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Toronto
theBasher91 wrote: Hi all,

I am entering my fourth year of University. I am eligible for OSAP, which I have received every year. I have approximately 20k in the bank (PCF @1.5%), and was looking if you guys have any other recommendations of where to put my money.
Depends on your risk tolerance. If you don't mind loosing 50% of your capital, trading stocks / options / forex in a QuestTrade account could your best option. If your risk tolerance is low, your current PCF is probably the best option.

That 1.5% you are getting today is called Risk Free Rate of Return. You could try to chase a higher rate but do not expect too much. 2.5% for two more moths with ING is the max (or 2.6% with PCF for new money - this doesn't help you much).
Member
Sep 10, 2012
274 posts
38 upvotes
What is your aim? To grow what you've got in the bank a little and pay off a good chunk of your loan as soon as you graduate (aka, you wouldn't want to lock it in for more than 1 year?)

I do wonder how you'd get OSAP for this coming year if you've got 20K in your bank account though.
Newbie
Aug 29, 2012
23 posts
1 upvote
Toronto
theBasher91 wrote: Hi all,

I am entering my fourth year of University. I am eligible for OSAP, which I have received every year. I have approximately 20k in the bank (PCF @1.5%), and was looking if you guys have any other recommendations of where to put my money.
We should first understand your risk tolerance and when do you plan to use the money?
Will you be using that soon to be paid of your OSAP once you gradruated?


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Comments are only for informational purpose and do not intend to provide any financial advice. Before making any financial decision, make sure to consult with a financial consultant.
Member
User avatar
Jun 15, 2009
407 posts
151 upvotes
Kaylya wrote: I do wonder how you'd get OSAP for this coming year if you've got 20K in your bank account though.
OSAP fraud.
Member
Dec 1, 2010
238 posts
22 upvotes
^^ Bingo. Better hope you don't get audited. When they audit, they get tax returns, bank statements, the whole shebang.
Deal Addict
Aug 19, 2006
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lewin00 wrote: ^^ Bingo. Better hope you don't get audited. When they audit, they get tax returns, bank statements, the whole shebang.
How is it OSAP fraud ? As far as I remember noone asks you how much money you have in your bank account when you apply for OSAP. These days 20k is not significant amount of money, just enough to pay for rent, metropass and food for a year.
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Feb 26, 2012
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MISSISSAUGA
lewin00 wrote: ^^ Bingo. Better hope you don't get audited. When they audit, they get tax returns, bank statements, the whole shebang.
I am in a similar situation, it is not fraud at all. And I have been audited before and gotten more money back even.

I have a co-op program, this year I will be working a paid co-op position for 8 Months + I have a part-time job. By the time I start school I am guessing ill be close to 15k, but lets see how much of that I get to keep if I paid for everything.

Tuition Fees = 7k
Room Rental = 3-4k
Food = 1k?
Book and Supplies = 2k

And this is only for 8months. I have been out of High School for more than 4 years, so my parents income is not a factor either.
How about we stay on topic instead of accusing him?

theBasher91 wrote: Hi all,

I am entering my fourth year of University. I am eligible for OSAP, which I have received every year. I have approximately 20k in the bank (PCF @1.5%), and was looking if you guys have any other recommendations of where to put my money.
I am in a very similar situation, although I am not 100% sure if I will get osap this coming Sept.

The moment I started working, the first thing I did was open a TFSA account with ING direct @ 1.4%
That imo is no risk, if you have no need for the money right away you could go with a long term savings and possibly get 2+%

What else you could consider is talking to your bank and mutual funds, depending on how much risk you want to take they will give you specific funds.

E.X
Low risk -> Guarenteed 0.5% interest as high as 1%
High Risk -> Guarenteed 0% interest as high as 3%

Above is just an example and numbers are 100% off.

Lastly you could put aside a small amount in stocks, that is what I have been doing and it has been going well so far.
Deal Expert
Mar 25, 2005
21683 posts
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krypton wrote: How is it OSAP fraud ? As far as I remember noone asks you how much money you have in your bank account when you apply for OSAP. These days 20k is not significant amount of money, just enough to pay for rent, metropass and food for a year.
You bet they ask.
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User avatar
Feb 22, 2013
2028 posts
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Ottawa, ON
theBasher91 wrote: Hi all,

I am entering my fourth year of University. I am eligible for OSAP, which I have received every year. I have approximately 20k in the bank (PCF @1.5%), and was looking if you guys have any other recommendations of where to put my money.
1. What do you want to do with that money (e.g. buy a house? Buy a car?)

2. When do you want to use it (1 year, 2 years, 5 years, 10 years?)

3. How low is "low" risk tolerance? Could you stand your $20,000 becoming $18,000 for a while (i.e. a 10% loss)? $16,000? $15,000? Or will you accept nothing more than that $20,000 always being worth more than $20,000?

Scotiabank has a good investment selector worksheet here, but if you're looking at mutual funds (after you've determined your risk rolerance and investment selections) then I would recommend TD e-Series over what Scotiabank offers.

There are plenty of other resources on asset allocation and risk tolerance:

http://canadiancouchpotato.com/2011/08/ ... llocation/
http://www.dummies.com/how-to/content/h ... ation.html
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Feb 22, 2013
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Ottawa, ON
Kasakato wrote: You bet they ask.
Absolutely not. I've received OSAP for going on five years and there is no question such as "how much money is in your savings account?" The closest box is "assets" but it specifically says DO NOT include invested cash, savings, etc.

OSAP money is free money. In fact, I would encourage any student to take as much OSAP as possible and invest it. Then when you're done school, you pay the government back in full (without interest) and you've just made interest on that money sitting in your bank account.
Deal Expert
Mar 25, 2005
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CWatson87 wrote: Absolutely not. I've received OSAP for going on five years and there is no question such as "how much money is in your savings account?" The closest box is "assets" but it specifically says DO NOT include invested cash, savings, etc.

OSAP money is free money. In fact, I would encourage any student to take as much OSAP as possible and invest it. Then when you're done school, you pay the government back in full (without interest) and you've just made interest on that money sitting in your bank account.
Your external deposits and investments are exactly what "other assets" are. Your past 5 years of applications are misleading.
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Feb 22, 2013
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Kasakato wrote: Your external deposits and investments are exactly what "other assets" are. Your past 5 years of applications are misleading.
All my applications have been correctly, accurately, and honestly filled out.
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Mar 25, 2005
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CWatson87 wrote: All my applications have been correctly, accurately, and honestly filled out.
OSAP other assets:

bonds, term deposits, GICs;
mutual funds;
real estate (excluding your primary residence);
boats or aircrafts; and
all other investments.

Any of these funded from non-education related income must be reported as an asset and thereby reduce funding. Best of luck with an audit.
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Feb 26, 2012
2051 posts
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MISSISSAUGA
Kasakato wrote: OSAP other assets:

bonds, term deposits, GICs;
mutual funds;
real estate (excluding your primary residence);
boats or aircrafts; and
all other investments.

Any of these funded from non-education related income must be reported as an asset and thereby reduce funding. Best of luck with an audit.
I am just curious, as of till now I have included in my applications the income from my co-op positions. Is my co-op considered a education related income?

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