To ask what you would do with 50k?

[PlanningAhead1]

Please do not see this as a gloaty thread at all as I promise it isn't meant to come across that way.
I'm from a pretty poor family, saved up and got married and bought a house 10yrs ago. Have 2 young DC. We don't struggle as such but we also say no to A LOT. We went abroad this time for the first time since 2019 and I feel amongst our friends we are seen as being tight (try to avoid rounds, feed our kids at home or take packed lunches etc).
Anyway, I am due to get just over £50k within the next few weeks. This is not inheritance and will not be taxed, but is in relation to something which happened to me a while back.
I know the temptation will be there to blow it. We need a new conservatory, I'd love invisalign braces, I'd love new built in wardrobes and to take the kids to florida. I know that this 50k Isn't a huge amount and will go quickly if I use it on the above.
It's got me thinking there must be better ways of spending it... I'm not sure if that's using it as a deposit to buy and rent out a house, set up a bouncy castle hire business, pay off a chunk of our 200k mortgage or our 20k car finance etc.
I have nobody to ask IRL as we aren't telling anyone about it but I want to make the best of it while i hVe the chance.
If you were to get 50k, what would you do with it?

One nice (not lavish but nicer than usual) holiday, then investments.

The car loan will be costing them money in interest payments? Of course people pay for cars in cash.
You should follow Dave Ramsey for finally advice.

You can’t afford to be a landlord.

I also don't think a BTL is a good idea. The value is not likely to significantly appreciate in the short term and the OP is probably not in a good financial position to take on extra commitments or have the time involved to be a good landlord.

But it is a little odd for a site that has such an open hatred of the private landlord also reliably suggests a BTL to be a good use of money for anyone asking about a sum of money to do something with.

*financial

It's there anything you could invest in that would increase your earning potential? Would the business idea be profitable?

I'd spend some on a treat and work out how the rest can help me long term.

I wouldn't be spending one penny of it if I had a mortgage of £200k and a car loan for £20k.
I would pay off the debts.

Pay off credit card
Pay back home improvement loan early
That's 20k gone already

New bathroom

Save the rest in premium bonds for inevitable new cars needed

One big treat- a city break hol for me and DP

Call your bank and ask how much you can overpay on the mortgage without charges. Sometimes its 10-20% of the initial value. Go from there - prioritise paying off debts that are highest interest first. From an outline of your financial situation, don't buy a BTL... they are a hassle, unless you can really comfortably afford it it'll be a worry.

As an example, for a property worth £120k which is your average price for a flat in some parts of the country right now - you could put down a 20% deposit which is £24k - you have £26k left.

You could cover those costs you mention with the rent you charge. The mortgage could be about £400 a month, you charge the rent at £700. That is £300 on top of the mortgage a month - £3,600 a year. You’d cover the costs easily so I wouldn’t worry.

I do agree, manage it locally where you can - vet your prospective tenants, put their deposit in a deposit protection scheme.
Just be selective with who you have as a tenant and obtain all the necessary paperwork.

I would blow it on something fun. All the high interest savings accounts and bonds really dont do it for me

If I had 50k I would put it towards a holiday bungalow somewhere lush

If this is a compensation payout for you then I would go for the Invisalign braces and the Florida holiday. Then I'd look to pay off car loan or pay towards your mortgage - whichever saves most in interest.

If I were you I would:

• Pay off car finance
• Get Invisalign (did this and am super happy with the results)
• Do something nice for the family (~£5k)
• Put the rest into a high-interest account/premium bonds/mortgage depending on the risk profile.

If I were me I would:

• Pay off my & partner's student loans (£8k & £4k).
• Pay off my outstanding debt (£1.5k).
• Put £10k towards wedding & honeymoon next year in 95 day notice savings.
• Treat my family & partner with various things I know they need or really want.
• Put £20k in highest interest savings vehicle I can find.

I would put a proper roof onto my conservatory and make it into a proper downstairs bedroom. However I have paid off my mortgage. If I was you I would either spend it on paying towards my mortgage or on making improvements to my home.

But that is me, you have to work out what is best for you and your family.

I like the rule of thumb "spend a third, save a third, invest a third".

I see a lot of "I'd love this/that" in your post, so the first thing I would say is write a list of needs versus wants. New conservatory sounds good, if you NEED extra space.

Invest a third into "needs" be it house upgrades or things for the kids, new shoes, upgrade to their bedclothes, room furnishings etc.

Put a third away to blow. I vote big luxurious family holiday. 5 star hotel, all inclusive, somewhere with something to keep the kids occupied (Port Aventura, Salou for example, beautiful hotel, theme park nextdoor).

Invest the other third into the mortgage as it will bring your bills down. That's a sensible investment.

Congrats on your windfall either way! Hope it goes towards making life easier and a bit more enjoyable for you.

I would quit my job and go back to college, learn to drive and have one nice holiday. If anything was left I would save it 😄

I don't think anyone who is actually a landlord and realized how expensive and costly is has become to be one is suggesting op does this

Op do not blow it on florid if its something unsustainable. Ie that's all you're holiday again for 10 years.

Use this money to set yourself up.

Do you have a stocks and shares isa. If not open one up and get at least 3 grand in. Index funds which are a lot it different companies.

2. opened stocks and shares isa again maybe 2 grand.
   The idea is to you don't touch these esp not the stocks and shares isa. That should rumble along in the background building up for years.
   2a) do you have a sipp, self invested personally pension, again open one up (look at best invest, hargreve and landowne) put again maybe 3 grand in, index funds.

3. open a jisa for yours children (junior isa) maybe put 1 or 2 grand in?

4. cash isa fir the or others savings account.

5. send now money account to teach them the stocks isa is for longer term and not to touch.

Then.. Look at your emergency savings people say 3 to 6 months of the your current incoming. Put that in easy access high interest account.

Once all these bases are covered and you have wrapped yourself and fhe dc in a blanket of money comfort...

Then look at over paying mortgage, invisalign and whatever.

Instead of florida i would start a holiday saving fund and use a feel grand to get it started then add to it each month with what you can afford.

So you can gey way more than regularly whether that's aboard order smaller more frequented breaks.

Start same for Christmas and any other large expenses.

Try and still live within your means and build up all your savings.

Use maybe 7 grand for the treats and spread those treats out.

I would hold "treat money" in premium bonds because you may win something.

Good luck op.

A poor persons mind roll spend that money in one poof of smoke.

A rich persons mind will use it to set up their dc, invest it and build upon it so you don't get one nice year you get many.

5k to treat ourselves, 5k in a rainy-day fund for short term access, pay off all debts (~20k), and probably put the remainder in gold.

• 2 is stocks and share cash isa

This has actually just happened to me - I inherited just under £50K very unexpectedly. It's currently split across the highest interest savings accounts we could find until our mortgage term ends in 2 years, at which point it will go into paying off the mortgage. We're also doing a small but expensive job in the house which is purely to make a bit of it look prettier.

Pay off debts, it's dull but best in the long run...

New conservatory roof, windows and blinds.
Soffit and fascia.
Resin the gravel garden path that the cats use as a litter tray.
New bathroom.
If any left, go on holiday.

Max 5% to holidays, toys, clothes etc.
If you have debt including mortgage, then pay that first or at least 75%.
Then home improvements; we would have a bunch to spend it on here so that would be my choice.
Then pension, savings.

Thanks so much for all the opinions and advice, it's been really interesting.
I've looked into car finance - settlement figure is £20,560 at a rate of 6.6%. Would you think paying this off is the right thing to do?
Premium bonds are something I had heard of but knew nothing about, I've been reading up on these tonight and they definitely sound like a good option.
As does putting a few £ into ISAs for our DC.
I agree with those of you saying maybe do nothing with the money for a while until I am sure in my own mind that I'm making the right decisions. I think I should probably choose between the invisalign, the wardrobes or the holiday and just accept that the holiday is not going to be Florida.
My DH is of the opinion that we should juat use the money for fun and nothing else amd just enjoy it, which I'm so tempted to do but I have a feeling we will regret it. He is suggesting lapland, an annual abroad holiday etc where we don't have to stress about the cost for the next decade which does sound amazing.

To clarify too... when I said we try and avoid rounds, we would never not return drinks if they'd been bought for us. Its more that our friends can drink quite a bit whereas my DH isn't a huge drinker and I like to drink but am slow and steady. So when we start going in rounds with friends by the 2nd or 3rd round we are saying we don't want one but we still end up buying loads despite only having 1 or 2 ourselves. It just adds up. If we are on our own at the put we will spend £20 topps, when we are with friends it ends up being more like £50 despite us drinking no more than we would if we were there on our own :)

Also to the person who asked about if I'll need to use the money for counselling if it's relating to something traumatic - it is a personal injury claim and it has been pretty awful however its been a couple of years now since the accident and I've had a lot of counselling in that time which was paid for by the other sides insurers. If i need more I have private Aviva with my work so hopefully the money won't be required for anything like that. Thanks for raising it though as it's a fair point