I got a small inheritance ($10K) a few months ago and am struggling to figure out how to make the most of it. We are not likely to inherit any more money at any other point in our lives.
Background - We are middle income but live quite frugally. Our only debt is our house which we have about $50K left on. We put a significant amount of money in retirement/college/life insurance accounts monthly as we are planning to semi-retire earlier that normal. With the recent financial situation, we have lost a good deal of our retirement investments. I am a little worried about throwing more money into our traditional investments for this reason. We do have an emergency account that we could live off of for at least 6 months and likely longer if we needed to. Our house needs some major work. We have already saved for the new roof it will need within the next 2 years. That is separate from the emergency account. Our house needs another $20-$30K repair within the next 5 years that we have not saved for. However, if things continue as they are and we save like we did for the roof, we should be able to come up with it within 5 years or could go with a home-equity account if we needed to do the repair early. We could pay off the equity loan in that 5 year time span. We unschool and suspect our dd may not choose a traditional college route, so I am also shy about sinking more than we already do into the 529 right now, although theoretically, I would like to see this money work for her. We have one car too many right now, both are paid off, and both are in fine working condition (as in, should last for a few years).
Given all of that, which is the smartest choice?
1. Put all of the money towards the principle on our house (our only debt).
2. Put it in savings for the house repair.
3. Put it in investments.
4. Go on a wild and crazy vacation (I am kidding.....mostly).
5. Other.
Background - We are middle income but live quite frugally. Our only debt is our house which we have about $50K left on. We put a significant amount of money in retirement/college/life insurance accounts monthly as we are planning to semi-retire earlier that normal. With the recent financial situation, we have lost a good deal of our retirement investments. I am a little worried about throwing more money into our traditional investments for this reason. We do have an emergency account that we could live off of for at least 6 months and likely longer if we needed to. Our house needs some major work. We have already saved for the new roof it will need within the next 2 years. That is separate from the emergency account. Our house needs another $20-$30K repair within the next 5 years that we have not saved for. However, if things continue as they are and we save like we did for the roof, we should be able to come up with it within 5 years or could go with a home-equity account if we needed to do the repair early. We could pay off the equity loan in that 5 year time span. We unschool and suspect our dd may not choose a traditional college route, so I am also shy about sinking more than we already do into the 529 right now, although theoretically, I would like to see this money work for her. We have one car too many right now, both are paid off, and both are in fine working condition (as in, should last for a few years).
Given all of that, which is the smartest choice?
1. Put all of the money towards the principle on our house (our only debt).
2. Put it in savings for the house repair.
3. Put it in investments.
4. Go on a wild and crazy vacation (I am kidding.....mostly).
5. Other.
