Tuesday, August 21, 2007

Vegemite and Kangaroos at 4.5% APR

I did it. I took the first step toward my trip to Australia by I opening an ING savings account. It's only 4.5% APR versus 5.05% at HSBC but I got a $25 signing bonus and $10 for Friendster Guy for his referral so everybody wins. Plus, 1.05% of the $1,000 I started it with is only $10 anyway (I'm not counting compound interest - that's too hard to calculate and I don't even know where to start) so really, in the 19 months before I plan to venture forth, I'll probably come out ahead this way. I even took the next, slightly panic inducing, step of having $200 automatically withdrawn monthly from my checking into this new savings account (only after reassuring myself that if I get into dire straits - i.e. selling platelets or other body organs - I can transfer stuff around).

I do feel a little bit of a dilemma in that my $11,500 student loans are sitting around at 4.8%. That's not bad in and of itself but it means that technically (in my mind anyway - I am not and will never be a CPA), for every dollar I save and do not pay to them, I'm losing .3%. Considering right now I'm losing the whole 4.8% I suppose I'm actually doing better with this new account. I think that the presence of student loans balances out slightly in tax benefits and increased credit score. At least that's what I'm going to tell myself. Plus, the psychological bonus of knowing I'm going on a trip doesn't hurt. The student loans will go away when they go away. And will that be a happy day or what? I'll have to plan a celebratory trip : )

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