So i'm frugal, but what's next ?

I am a frugal person entering his senior year in college [age 21]. I have been following advice like the stuff in thread 84915 and thread 99852 and living below my means. I sought advice in Financial books for college kids my age [for example, generation debt], but left feeling wanting more because they focus primarily on how to cut expenses [skipping the latte, etc]. So, I have some student loans already, but will need more for my senior year. I also have some money set aside, but I should I use this money to lower the loan amount that I'll take out or use this money for an investment (Roth IRA, index fund), and take out more for my student loans ? Here's my scenario: - I have NO debt - EXCEPT from my Student Loan Debt ($46,025.40 for undergrad so far, heading into my senior year). ($27,519.40 are government loans - fixed rates, ), the rest is from a private company, at variable rate - A combination of federal and private loans I am getting VERY Scared about affording this (right now, I have estimated payments of $ 541.34, given the current interest rates and a normal payment schedule that is not income contingent). - I have NO credit cards. - I do have a checking account (with a debit card). - I have a saving account (only 1.05% APR) of $ 800 (a 6 month emergency reserve). - In the past 5 months or so, I have saved 40 % of my income to a general savings and a checking account (it's only 1.05 APR, and I know there's better ones (ING, etc) but both my [savings and checking] banks charge a rather large fee (of $30 or so) for transactions from one bank account to another, for retirement. My most important question is THAT I have received conflicting advice regarding the following situation: This fall, I'll need to take out an additional $5,500 (estimated) for living expenses (this is living frugally, rent, utilities, etc) (I am aware that I could work off campus more hours, but I have tentatively decided not to do that. (I decided not to work more than 12-15 hours a week, while in school, which can be for metatalk if you want to discuss that). Should I take that 40% [which I saved - $650] and my federal work study job income ($2220) towards my expenses and take out a smaller loan (the advice from a counselor at the school financial aid office) ? (Because any rate that I get on investing wouldn't be higher than my loan rate) (I have not applied for the loan yet, so not sure of the rates that I'd be getting. This loan would be a private loan, because I am already taking out the maximum from Stafford and Perkins loans. I am looking at PLUS Loans - another govt loan, but that may not work, because my parents do not want a loan in their name). Should I take that money and put it into certain investments for retirement (Roth IRA, Index Fund,etc) ? Should I put that into something more safer like a money market account (Andrew Tobias' advice for those with less than $5,000) ?