[USER]

My Family is receiving 100k soon, just looking for some feedback for what you would do in our situation. Currently owe 94k @3.75% on our house, would take about 30-40k in repairs/upgrades to make it our dream(ish) home, student loans at 48k, tax debt of 6k, owe 11k on one car, and have about 10k in credit card debt.

My husband & I both work making about 100k combined annually and we have almost 10k saved.

Would you invest any of it or would 100% go into debt payoff?

[Marc]

I would pay off the credit card debt, the tax debt, the car debt and the student loan.

With the rest…do you have a safety fund? If not, then the rest goes into the safety fund. If it’s funded, then repairs and upgrades to the house.

[Sean]

Why would you have 10k saved with 10k in credit cards debt at 6k in tax debt? Those should go asap. Then what is the car and student loan interest rates? If high pay that off.

Next build a 3-6 months emergency fund. Following that invest and save for the renovations.

[Noa]

Do you have investments already? if you have your investments already set up, plan for retiremenr contributions, Id use this money to pay off cc, student loans and tax debt, and spend 30k on renos. If you don’t have any investments, Id pay off cc, student loans and tax debt, and put the rest towards retirement (starting with Roth IRA for 2023 and 2024 for each of you).

[Hana]

An opportunity not to be wasted or taken lightly!

Pay off student loans, tax debt, car debt, and cc debt. From what’s left, build up your emergency fund to cover at least 6 months essential expenses plus sinking fund for unexpected car repair and home repair that may arise. From leftover, I wouldn’t upgrade your house if cosmetic—that, you should save up separately for. If something is broken, absolutely spend the leftover money on the repair/replace. With any remainder and future months/years with extra cash flow now, apply discipline to fund your retirement accounts with velocity!

Have you seen: My shovel just got bigger! Paid off two student loans!! YES

[Heather]

Pay off everything but the house. You simply don’t have the money right now for the repairs/upgrades… those should not be part of the conversation at this point.

Do you have any retirement savings at all? Use what is left over to max out your and your husbands Roth for last year and then do as much as you can for this years Roth.

[Lydia]

Always pay of high interest debt first! Unless you have a way to invest the money at a return rate that is significantly greater than the debt interest rate.

[Andrew]

Pay off all debt except the mortgage. You’ll have $25k left. Invest that money. I sense you folks want to upgrade your home. Take the cash flow from the existing debt that you paid off and save that for 6-12 months.

Use that money for repairs and upgrades if that makes you happy.

[Robson]

$75k to go payoff all debts but mortgage. Rest to go repairs you will need to make eventually and would probably finance it at higher rates. So $75k makes you almost debt free and $25k almost get you the dream house.

[Author]

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