What do people do with inheritance money

[88Pandora88]

Sadly my Grandad passed earlier this year, today I've just received inheritance. Just over 6 grand. I was shocked, grateful, made me a little teary but thankful etc..

What do people do with it?

I have a credit card which needs paying off, so I've just put 2 grand on that which will help massively, there's still 3 grand to pay but for now I've put most of the rest into an ISA account, put a little into both my girls isas for when they're older, and then just left the rest in my normal account for now.

Just wondering what others do 😊

I inherited around £12k and put it in my pension.

I would also payoff the entire credit card debt, I would save what I had been paying on the debt every month moving forwards. As a thank to my Grandparent for turning my finances around.

Inherited from my mum this year. We payed off our mortgage.

I disagree with paying off the credit card - if it's 0% that is. You've paid off some. Keep the remaining 4K. Maybe spend some but keep an emergency fund in case your boiler / roof etc need repairing.
You can tart your credit card over to another 0% when needed. Just set your monthly payment to ensure it's all cleared by the end of the term.

Always pay off debt first if you receive an inheritance. Then anything left is truly YOUR money, to do what you like with. Before then, try to see it that inheritance as money that is already owed to someone else.

I received a fair bit more than that but we’re older than you. We paid off our mortgage, which meant that we had more disposable income each month, which in turn meant a slightly nicer lifestyle eg more meals out etc. and could put more into savings for holidays, weekends away. No longer worried about interest rate rises.

we bought a brand new car each and will run those till they don’t go anymore.

I moved from a job I hated to one paying less money out of choice because I could afford it.

A chunk is earmarked for university costs, coming in very handy now that one son started last year and another will next year. At least one is looking to be a high earner on graduation so we will probably pay off his student loan in full when he graduates then he can start his working life debt free.

Put the rest into savings and investments and earn a decent amount in interest which goes purely towards fun stuff each year eg fancier holidays which we couldn’t have afforded before.

The rest is my retirement fund as I have never really earned much so my workplace pensions are neither here nor there.

If I’d been younger I would have used it to retrain and get a better job but I’m too near retirement to do that so I’m just plodding along till I can retire early instead maybe at 55. I could afford to go part time whenever I wanted and it’s great having that freedom of choice.

There’s all sorts needs doing to the house and garden but it’s going to have to wait till we’re retired or I’m part time because we have had minimal success in finding reliable contractors who even turn up to quote and we don’t have the sort of jobs with flexibility to be able to come home to wait in to meet with people who don’t turn up or who don’t bother to quote or get back to us.

it’s just generally nice to have no worries if a large unexpected expense comes in. We are extremely lucky in that way. I can also give more regularly to charity.

That all depends on how good you are with money. Some people are a bit disorganised and would forget to pay off the minimum balance each month or to switch cards when the 0% deal ended. And they would just dip into savings if they had a stressful few weeks and tell themselves they deserved a treat and blow a chunk on a fancy weekend away. Before they know it that money is gone and they still have the debt.

Those types of people would be better getting rid of the debt and using the spare repayment money when it’s cleared to start a savings cushion for unexpected expenses, that is ACTUALLY their money. They may then feel differently towards it, as may see it more as money they have been disciplined in saving up and so would think more carefully about how to spend it. Even if they do blow some on a weekend away they don’t really need, well, at least they can have a nice time free of worry that they’ve still got that credit card debt hanging over their head.

Blowing all your savings and coming out of it with the same level of debt as you had before is similar to those lottery jackpot winners blowing all their money and then ending up with nothing after a few years and they’re in the tabloids looking miserable cos they’re back to square one.

It all depends on individual circumstances though. If you know your income is going to increase dramatically in a couple of years then it wouldn’t matter so much to keep 0% credit card debt till then when you can start paying bigger chunks off without really noticing it.

If your income is not going to increase and you’re shit with money it’d be better to get rid of the CC debt in my view, as long as you’re not just then going to start letting it build up again from nights out and multiple holidays.

It might be nice to spend a few hundred on a special something to remember him, a piece of jewelry, print, book, activity day or something.

If you have debt I'd prioritise that. When my mum died I was early thirties and inherited about 20k. I bought a lifetime National trust membership (she loved gardens and this was my best purchase with the money), a sewing machine, a kitchen aid, a laptop (as needed one) and a piece of art. The rest went on general life/when we moved house.

A few years ago my grandmother died and it's going towards an extension.

I inherited very unexpectedly.
I paid off our mortgage ( very small) , bought a beautiful diamond pendant.. and saves some.
6 K is enough to make a difference… pay off credit card… you will be so relieved and buy something to remember your relative and their gift to you ( paying debt is a great gift)

We went on holiday - cruise, Amsterdam and Cornwall. Did up the house. Bought an apartment to rent out (partially paid for this).

I'd pay off all the debt, then you can make monthly payments into an isa if you want to build savings. It doesn't make sense to be saving money when you still have outstanding debt, as most likely the interest rate you'll be paying on your debt will be higher than what you earn on your isa.

We paid off a chunk of the mortgage, went on an extra holiday, saved some and spent some on the house.

I would use a smaller sum to do something amazing that if otherwise struggle to afford eg a trip, an experience, buy a piece of jewellery etc
A larger sum I'd invest towards my retirement, for my children in the future.

It is my personal opinion that an inheritance is given for the recipient to do something out if the ordinary with not to disappear into bills & general living expenses.

I would also suggest that women are more likely to spend on all / bills whilst men will ring fence the inheritance for fun or investment and that women should be more selfish & do similar

I've had three small inheritances so far.

My mum's jewellery which I kept and wear some pieces regularly.

£5k from my gran when I was 20. I put it in a long term savings bond and added a bit more over the years. I used the resulting £9k when I was 35 to pay all the costs when we bought our flat (conveyancing fees, stamp duty, movers fees, new carpets, furniture, curtains etc..). I also spent £1k of itnon a dental implant to replace a failed root canal. My dad was a bit miffed that I had "thrown the money away" rather than use it as a deposit - I did try and explain gently that £8k was not going to get me very far as a deposit on a London flat in 2015.

£3k from my grandad when I was 28 which I used to clear the remainder of my student loan. I know it wasn't a priority debt but the satisifaction of telling the Student Loans Company to "do one" and not handing over £134 every month (I had an old style loan) was worth it.

Pay off the debt if it has any interest. Then start a monthly regular saver, which you pay into on pay day abs can't touch. Once it's matures in 12 months put it into your ISA

When I inherited £400 from my grandmother, I bought a proper sturdy garden table.

What's the point if this question, people can do whatever they want with it. You might as well just ask on what do you spend money.

Sadly, my inheritance is still in savings accounts.

My brother and I inherited around £100k each from our Dad when he died years ago. (He had gone into care and we had just sold his house). Neither of us have spent any of it.

We both feel the same, we didn't earn it so don't feel we can spend it. We both have enough that we have earned to live reasonably comfortably. Probably stems from when we were kids. Parents not at all well off and we were all always scared to buy anything frivalous in case somewhere down the line it was needed for essentials. Ridiculous, I know to still think like this but it's ingrained. His will probably pass on to his children (we did give them some after probate settled) when they need it and mine will probably go on my care costs when needed (no children).

A bit sad really.

We used some of the money we inherited from DH's aunt to buy an oil painting he loved from her house. To shut down really nasty squabbling over possessions between her children the executors sent all the contents of the house to auction and told people to bid if they want. We did want and we did bid and now we have a wonderful painting in remembrance.

@DoraSpenlow when we inherited from DFIL we felt the same. But we looked at it as 'seed money' and knew that his dad would not want it sitting around but to grow for our benefit. So it went into investments.

@DoraSpenlow why don't you put it in to your pension? That way you will honour your dad's desire to be careful with money but also get benefit from it? I am sure he would be very pleased his hard work will make your retirement a bit more comfortable.

I like Martin Lewis' phrase 'if you have debt, you don't have savings'.

I'd pay off the CC debt in full, then either cut it up or put it away for absolute emergencies (I kero my CCs in a Tupperware box at the bottom of the freezer!).

I agree with this. Debt first, then things that need doing or that you are already saving toward, then the rest in savings.

I inherited about £30k over 10 years ago. I put 25 percent deposit on a 3 bedroom btl house. I asked my sister if she wanted to go halves but she said no and she put her money into ISA's I bought the house for £103k. Spent money on new double glazing and bought a nice pressed but good quality kitchen from eBay with top of range appliances. DH fitted new quality laminate throughout. A few years ago I had a new bathroom fitted. Now it's worth £180k + and I only have £30k left to pay as overpaid whilst mortgages were cheap. It's been let every single month since I put it up for rental. I've made about £200 pcm which I've overpaid on mortgage each month and paid repayment mortgage on it from rents. I've had new decking put into the garden and a bit of soft landscaping to complement. The house next door which was very tired looking was sold for £182k and the agent knocked on the door and asked tenants if they wanted to sell. He said with the lovely garden my house has it might get close to £190k. I assured tenants I'm not selling as I want to keep it as a gift to my 2 DGS's but nice to know it's current value. This house has been home to a lovely family throughout the time I've owned it. My sister told me her ISA's now worth £34k. She wishes she'd gone Half's' with me now. If you have an inheritance make it work for you if you can. My sister now has £34k whereas I have over £150k. If Mum had been alive she'd have told my sister to let me invest it for her into property.

Is use some of it to buy something nice like a ring in memory of him.

Had 'retired' by the time probate sorted. I say 'retired' but actually made redundant at 61. Having had a job since I was 14 decided I wasn't going to start again and was in the fortunate position of being able to just finish working. Good idea though.