College students are investing in bitcoin with financial aid money

More than 20 percent of students report that they’ve invested in cryptocurrencies with their student loans.

From CNBC:

Tuition paid, textbooks bought… time to buy bitcoin?

More than 20 percent of college students use their financial aid money to invest in cryptocurrencies, according to new findings by The Student Loan Report, a website for student loan information.

The site polled 1,000 current college students with loan debt this month. The survey did not ask how much students were investing and many could be buying only smaller amounts.

“I was definitely surprised,” said Drew Cloud, The Student Loan Report’s founder.

“Living on a tight budget, one would think students would spend that money on groceries, rent or school supplies rather than bitcoin and ethereum.”

Undergraduate students received on average around $4,600 in federal loans in the 2016-2017 academic year, according to the College Board.

A student who spends their student loans on cryptocurrencies is violating their agreement with the government, said Elyssa Kirkham, of Student Loan Hero, a website for managing student loans.

“Investing is not an educational expense, so it’s against the rules to use your student loan money to buy cryptocurrencies,” Kirkham said.

Plus, any gains are likely to be offset, she said, by the taxes a student would have to pay on them along with the fees and interest that come with student loans.

She did suggest an alternative…

Continue reading at CNBC

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