What to do with 40K

[Roper99]

I could be in line for around 40k inherintance. Question is what's the most sensible way to spend it?

My details....
Married
2 kids under 2 years old
Mortgage 75k, 20 years remaining
2 cars, loans around 18k. Combined we pay £450 per month, will be doing this for the next 3 years.

...that's it.

Wife says it's best to put 30k against the mortgage, leaving a 45k mortgage and reduce the term. I'm thinking we should pay off the cars and save the £450 per month for 36 months = £16200 ...we then use this plus the trade in from our old cars to get new cars, then continue to save the money we would normally spend on cars, 3 years later do the same....etc etc.

My logic is the interest rate of the HP on the cars is higher, and probably always will be, than the interest rate on the mortgage.

Not sure if this would be better in the dog and duck? Any advice would be appreciated.

[{{909}}]

I'm no expert but I would use it to clear the loans and use the remainder on the mortgage. Cant see any logic in splashing out on new cars unless you have to. whichever credit agreement has the highest interest, blitz it.

[wakadoo]

inflation is aroud 3 to 4% so if it sits in the bank it will drop that figure every year.

pay off your debts (if any have early payment penalties pay them to within a pound and take the penalty on the last pound) try to use the money to make money is what i would do.

[blacksheep]

I'm guessing the loans have the highest rate of interest and will be noticably higher than anythign you will get from any savings account/ISA/bonds etc so best bang for your buck is to pay them off, pay off as much of the mortgage as you can, refinance the mortgage and get a better deal (if possible) and lower your monthly payments for the next 20 years or pay the same for 12-15 years.

[pumpman]

if it were me , pay the cars off , but keep them, fling the rest into paying some of the mortgage off, then overpay the mortgage by using what you would have been paying for the cars (if the mortgage lets you) then by any luck by the time the kids get into their teens you will have paid off the house , and have money to help pay for their education or whatever.

[PrideandPassion]

I would pay it off the mortgage, on average for every pound borrowed you pay back £2 (the interest rate may be lower but you pay it off over a much longer term) Then if mortgage is only £45k you could continue paying what you are paying now and pay it off a lot sooner. You will be mortgage free a lot sooner and have loads of play money just as you hit midlife crises

This is all based on the assumption that you can currently afford the mortgage and the cars.

[ekkl]

40k, not bad little windfall. I would clear any debt then use the rest to reduce the mortgage.

I am debt free at the moment. It has taken me years of hard work, overtime etc to get rid of my HP/loans etc and I am glad to say it's all gone now. I just have the mortgage to pay now, I wish I could have done this years ago. My other half earns more than me now so we have quite a good overall income and we can do what we please more or less within reason. Our lifestyle has changed dramatically since going debt free it's brilliant.

[Sanj[UK]]

I could be in line for around 40k inherintance. Question is what's the most sensible way to spend it?

My details....
Married
2 kids under 2 years old
Mortgage 75k, 20 years remaining
2 cars, loans around 18k. Combined we pay £450 per month, will be doing this for the next 3 years.

...that's it.

Wife says it's best to put 30k against the mortgage, leaving a 45k mortgage and reduce the term. I'm thinking we should pay off the cars and save the £450 per month for 36 months = £16200 ...we then use this plus the trade in from our old cars to get new cars, then continue to save the money we would normally spend on cars, 3 years later do the same....etc etc.

My logic is the interest rate of the HP on the cars is higher, and probably always will be, than the interest rate on the mortgage.

Not sure if this would be better in the dog and duck? Any advice would be appreciated.

40k? Spend 10k on it on lloyds share..you'll be sucking my dick come 3 years time

[AxE]

Id put some away so u make more on it in a few years time.

Ive just been given 10k but thats goin on deposit for a house.

[Realist]

I pay it off the house and lower the years remaining as well.

[Greyfox]

40k worth of porn?

[Roper99]

Thanks for everyone's opinions. The wife and I will discuss and let you know what we decide. Thanks

[steve10574]

ya i would do what most have said clear the debt and pay as much of house as you can

But i would make sure you use a little for a treat for the family as i am sure thats what the people that have left it to you would have liked 5* family holiday maybe?

[blacksheep]

40k? Spend 10k on it on lloyds share..you'll be sucking my dick come 3 years time

What, to make back the money he's lost?

[flukesy]

Buy some silver bullion my friend, bout £10k's worth.

[Rick Sanchez]

pay cars off and ALL of the rest on the mortgage

[Sanj[UK]]

What, to make back the money he's lost?

If he buys now..its gna be triple the value at this rate

[Geko]

40k? Spend 10k on it on lloyds share..you'll be sucking my dick come 3 years time

LOL

RBS for me.

[Sanj[UK]]

LOL

RBS for me.

Yeah I bought a shitload at 60p..says it all

[B B Leo]

premium bond and for about 6 months and see if ur number comes up! give u time to think of what u could buy then cash them in.. ur not going to lose anything that way and might get a bit back!