How would you use this money?

[EvenLess07]

Long time MNetter with a name change. In the near future, I'm going to be in receipt of a fairly significant sum. It hasn't been exactly determined but I'll know in the next few days- anticipate it to be £50-£60k after legal fees have been paid.

Please don't think I'm bragging- I'm getting this money because something truly awful happened to me in my childhood and it has affected my earning potential quite significantly due to the health conditions I now live with. It has been a long time coming that I get justice from the institution that I am pursuing. I would like to use the money thoughtfully to benefit our family.

My question is, say it's £50k- how would you be using this money? Is it worth getting some financial advice on what is a lot of money but not life changing? I'm in quite a privileged position- early 30's SAHM, 1 young child, we've got savings so we're doing ok. We've got about 20 years left on the mortgage and our monthly repayments are about 20-25% of our monthly expenditure.

I'm hoping to use some of the money to put towards some training to pursue a new career but this won't be for a couple of years (toddler/terminally ill parent and the other parent is disabled so is going to need more support going forward).

I'd like to put a couple of thousand away for my DD in her account, or maybe invest it for her. I should probably put some in a pension but have no idea where to begin with this. I will be making a donation to a charity who support victims of the sort of crime I experienced.

Any further suggestions are most welcome. Thank you.

Oh dear looks like my name change failed. Never mind , I tried😂

If your earning capacity is limited it would probably be worth putting a substantial amount into a pension.

I wouldn’t give some to your DD because that’s not what the money is for - it would be different if you had ‘won’ it or something. I’d caution against paying off the mortgage in case of a relationship breakdown but as you are a SAHM then it could be argued that you are paying your way I suppose.

I would be tempted to pay some off your mortgage if it's 25% of your income but then if your mortgage is for say £300k is it really going to make that much difference anyway ! Do you need a new car /home improvements/holiday ?

1 Pay off the mortgage if it's enough. 2. Put some into your pension.

I have similar circumstances coming up. I’m planning a small family holiday, some towards my recovery and then the rest off our mortgage. We’re looking at saving £60/70,000 in interest payments.

Overall I believe financially it’s better to put it in a pension, I’m late 30s, but prefer the financial security of knowing our mortgage would be paid off in a few years.

Hello, I just thought I'd update. Thank you all for your input. I got the news today that after legal fees, I'll be receiving towards the top end of what I'd hoped for so I'm really happy about that. Obviously it would have been better if I hadn't been abused as a child and been ignored/had what happened to me covered up by an institution who should have helped me... But that's my reality, and I'm going to make the best of it.

So far, I've decided to use about £10k towards the mortgage when we remortgage at the end of the year and open a private pension that we will continue to pay into monthly. I'm going to give myself a few thousand as fun money (take my DD on holiday, a few new clothes, maybe a personal styling session). The rest I'm going to sit on for a while. I'll be finding myself a decent therapist too.

That sounds like a good plan and am pleased that you received a good amount of financial compensation.

Thats good you got it sorted @EvenLess07

Wishing you all the best with your therapy.

Ok, now everyone can advise me on my lottery win - £5.00!!

I'd consider holding off on the mortgage overpayment if you're not going to make a big dent in it tbh.

I'd agree. Better to have accessible rainy day money for the long term x

That's a good point some of you made about the interest rates. £10k won't make a massive dent in the mortgage so will think again about that. I'm leaning towards putting that to the money I was going to put in a pension, it will still leave us with a decent amount for a rainy day. I'm going to look around for a financial advisor over the next few weeks to chat about my options.

DH reminded me that DD already has a Junior ISA and we have a separate savings account for her as well so we can put a little in there for her.

On the shallower side, I'm looking forward to buying a few nice things with the couple of thousand of fun money I'm putting aside. Nothing insanely extravagant but a new handbag from the designer outlet, a few days away at Center Parcs or the seaside for DD, a new pair of DM's because my feet changed size in pregnancy. It's stuff I could realistically pay for now (and feel very grateful that I can do so) but it will feel good to buy it with this money.