Think of it this way: if you receive $5000 or more one semester, but you don’t use it all at once, doesn’t it make sense to at least keep your money in a high-interest savings account, maybe one at ING? But if you’re keeping it in a high-interest account so that you’ll earn a bit more interest on the side (the interest that you’ll just have to pay back to the lender someday anyway), why not put it in a vehicle that will give you a bit more return?

The tradeoff is security. You have to be reasonably assured that your money is reasonably safe where you put it (obviously). I say, if you’re going to try to go this route (after you’ve investigated how legal this is in your jurisdiction), invest in a solid bank stock. In Canada that might be much easier than the U.S., where there is a real proliferation of banks (many of which I’m not quite sure I’d trust keeping my money in - but that’s just because I’m used to our “big six”).

Choose a large bank like Citigroup (NYSE: C) or the Royal Bank of Canada (TSE: RY). Instead of opening up a savings account, invest in that bank’s common stock instead. Get some dividends. They’ll increase in value maybe twice a year. Just make sure you don’t overdo it – keep aside the money you’ll really need. These are just ideas, of course. You need to do the real research yourself.

What do you think: smart or stupid? Did you do this in college? Are you? Will you?