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Heya NathanUT ("Hook 'em Horns"! Is that how you say it?)

First off, it is a great thing that you'll be doing by socking away some moola while still in the summer prior to your senior year! Your miles ahead of the rest of the world.

My first guess is that your spare bucks might be coming from an internship or CO-OP job. If such is the case, is it possible for you to make that initial investment in the corporate 401K plan? Doing such allows you to enjoy the benfits of the time value of money and not pay taxes money you contribute (plus some companies will match your contribution up to a set level).

If your $$$ is coming from elsewhere, then I'd set up a Roth IRA first thing (you are only allowed $2K each year). (Similar to a 401K but you do pay taxes on the contrubution, but not on the gains - and at your age this Rocks!!!! (I've been going this route since I graduated 5 yrs ago - HAIL Purdue.)

In either case, I'm assuming you plan to put this money away for the long term.

Now to your question - I believe you should be looking at Stocks and/or Mutual Funds. But first, ask yourself how much effort you are willing to devote. Want to put some work into your investment? Then choose stocks. Want to let it ride and let someone else do the work? Then choose funds. My guess, while you are still in school, time is of the essence and your best bet would be a mutual fund, but you can afford to be aggressive. Small cap (small companies) value or growth funds would do you right.

Take a look into stocks when you get out of school (ahh, no more tests, homework and much more free time). Never pick just one - diversify. I've got a lot of friends that learned this the hard way. Again with your age, look for big growth potential (these are sometimes the riskiest - but time is on your side).

Right now markets to think about: Power, gas, oil, engineering & construction firms - are pretty good bets. Pharmaceutical stocks and funds always seem to bring steady returns too. I recommend reading Learn to Earn by Peter Lynch if your fresh to the investment world.

I hope this helps a little. I'll say no more on this post and try to help you out if you have any other ???

Best of luck to you.
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