What would you do with £40k?

[Reesescheeses]

I’ve just been gifted £40k. I’m feeling very very lucky and grateful to put it mildly. I need to think of how to use it.. how much to put in savings, how much to spend on things like doing up the house, holiday etc. Just curious what others would do?

Who the hell gets 'gifted' 40k???

Ah you know what, I’d love to just go to the Maldives for two weeks.

Save 39k and spend 1k on getting some work done on my face.

I’d use it to help get my kids on the housing ladder

That would be a no from me..
Site fees can be extortionate, if the mobile home is a few years old you will need to replace it at your own cost. Also you can't live in it in many sites.
Many wiser ways to spend £40k.

Buy a new (used) car. redecorate, recarpet, refurnish some of the house. Possibly turn a very large cupboard into a downstairs shower room. Do up the garden. Take a holiday (UK). Put the rest in savings. Obviously I couldn't do all of it but those are some ideas

I don’t own home so would use around 30-35k for house deposit and the rest a trip to Disney Florida. As lots of posters have said kids are only young for a short while and my motto is create S many special memories as possible. Holidays are the best way to spend quality time

Windows, roof, car, new bathroom.

Overpay all utilities but continue direct debit

Chunk into each kids savings

Big xmas supermarket shop

Bank rest and forget but im boeing

Half off the mortgage. Half for a new kitchen. Or maybe half off mortgage then £10k to a kitchen and £10k available savings to be used for holiday and rainy days.

"Mortgage is about to go up dramatically..."

It's a no brainer. Put it all on the mortgage. It will lower your monthly amount, could push you into a lower interest band (eg less than 60% LTV) meaning a better interest rate than you would have got, and reduce the capital owed for long term benefit when rates fall.

Financially it only makes sense to put it in ISAs if the ISA rate is higher than the new mortgage rate. Otherwise you're not benefitting.

Avoid premium bonds. Returns are poor vs ISAs on a % basis (less than 1 in 25,000 for £25 vs 5% in an ISA guaranteed). Martin Lewis has a piece on this.

I've paid my mortgage off. I'm 39. Over pay over pay over pay. Don't piss it up the wall on a holiday (again bad advice). Invest in your future.

Pay off my mortgage then buy a new sofa and get the family bathroom redone.
Lucky you!

Use it to pay for private school

I'd have the kitchen done as it's falling to bits and put the rest away for when DH's car packs up/other big jobs come up. Our day-to-day lifestyle is affordable but we haven't got much put away for emergencies.

All great ideas op but can I suggest you open up a sipp, self invest personal pension for each child?
If you put I don't know, 1 grand in each and put it into a global index tracker it's open and there for them. When they start to earn they can add to it and it should be a nice sum by the time they retire with actually very little financial input due to compounding.

I would also get stocks isa for myself.

In your shoes I’d pay 3k holidays, 7k car, 10k renovations, 10k mortgage if allowed to overpay, 10k financial pillow

Or 3k holidays, 7k car, 25k renovations, 5k financial pillow. Then once you no longer have to pay childcare over pay the mortgage by a few hundred each month if allowed.

In your circumstances id pay what I could off the mortgage, put anything thered be a penalty for paying off the mortgage into the highest interest savings I could (eg Chip account?) and wait to buy the car until some interest had built up.

I'd spend say £200 on a night out at the National Theatre - that's £20 tickets, travel and a nice meal.

I’d put 10k in the mortgage or I’d feel guilty.
5k on a cracking holiday (there’s only 2 of us so it would go a fair way)
25k on home improvements. We moved to a slow burn Reno house this year and it would go a long way to getting things done.

Overpaying your mortgage saves you £000s in interest. The two links below can help you see this.

https://www.moneysavingexpert.com/mortgages/mortgages-vs-savings/
https://www.moneysavingexpert.com/mortgages/mortgage-rate-calculator/

Find out the T & CS of your mortgage and any limits on over paying.

I suggest £20k (30max) off mortgage, the other £20k split between savings, a holiday and renovations as it’s important to have a balanced approach.

Note: your mortgage repayments should come down - try to keep repayments slightly higher to eat into the lump sum. Honestly when you are 55 you will be so glad if you have paid your mortgage off early. You then have more disposable income to save (and spend) for retirement.

Buy a flat/small terrace as an investment (still possible in some of the less popular areas up North)

I'd put £20k off the mortgage and use the other £20k for household stuff and holidays. Or put £40k off the mortgage. I've done lump sum payments as often as possible and was mortgage free by 52

Vanguard stocks and shares ISA

1. Mortgage. I do not understand UK mortgages which only allow a certain % of overpayment. Here in Aus, it’s much more common to just overpay however much you want. Choose a repayment amount and be done with it. If the interest rate goes down, your overpayment goes up at no further cost to you. Any lump sum added on, ditto. Yes, if interest rates go up, you will have to increase your payment. Find a mortgage provider that allows unlimited overpayment.

2). Appliances. There is a school of thought that before retirement, upgrade any elderly appliances you might have as the increased efficiency will be easier when in a fixed income. Might that apply to you? Not the retirement bit, obviously.

3). Car. Yes, you will need something. Doesn’t have to be new. New year/new tax year both see movement in the used car market so deals will be there.

I would put it all in your mortgage or pension. However, when the childcare money gets freed up, look at that to save up for holiday/car/home improvements.