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?

I would pay off all my debt and keep a couple of thousand for frittering and a mini break (so about £10K).

Then £20K into pension (despite it being worth sweet FA atm) & £20 into stocks and shares ISA. It would annoy me but at least it would mean I can't spend it.

I'd have to do something that made me feel responsible and like I'd improved our financial future. But life's too short to take a windfall and be responsible with it all. You could pay £50k off your mortgage tomorrow and get hit by a bus on Thursday 🤷‍♀️

In your shoes I think I'd:

• Pay off the car finance, £20k
• The amount I'd been paying for the car finance, save every month in the highest interest account I could, with a view to paying a chunk off the mortgage (at next renewal for better LTV)

That's the responsible bit done.

Then I'd use the £30k for pleasure only. Probably holidays, knowing I'm guaranteed a lovely holiday abroad every summer for the next few years.

THEN, when the £30k holiday money was due to run out..I'd STOP overpaying the mortgage with the monthly car finance money and save that amount each month into my new holiday fund instead, so my holidays remained a certainty.

@BlackberryCrumbs I think that sounds like a really good idea!

I’d pay our £17k debt (£10k of it my dad Leant us towards a deposit.)

Spend £12k on two (new to us) cars as ours are nearly in the knackers yard.

£15k on fixing our stairs and doors and windows.

£6k in premium bonds.

The amount we’d then have spare a month from paying the debt off would cover our holidays.

I got £50k in probably not dissimilar circumstances.

We spent it on the house in a way that we thought would both make it more liveable long term (3 kids since living here) and substantially increase the value when we sell it. Part of it was a garden room which is home offices and also could be a granny annexe if it needed to be.

I don't think it was wasted or badly spent but in retrospect we rushed a bit. If I had my time over I would put it in a high interest account and let things develop over a year or so. I think we might have spent less on some changes and more on others if we had given it more time.

But also, do treat yourself to some nice things now. You will have deserved them, because lumpsums don't come for nothing.

New bathroom
Resurface front garden/drive
Set some aside for half-term holidays, would rather be able to comfortably plan regular modest trips than a blow out holiday

Very good advice

Can I just say, it really stands out that yur husband wants to blow it all on fun.

Who benefits most from your debts? Does he mostly use the finance car? Could a cheaper option have been better? Just dont be sucked into something because its exciting. X

Please don't blow it all on having fun op. Use it wisely.

pay off your cars and use the rest to make you happy.

I would pay off car finance and overpay mortgage with the remaining 30k. I estimate that this would give you about 300 to 500 pounds extra spending money per month, depending on your interest rates. If you saved that each month, you could have 1 big treat each year, like a foreign holiday, home improvements etc. or simply enjoy life a bit more, with more eating out and entertaining friends etc. Over 8 to 10 years, you would double your windfall that way without taking any investment risks.

Personally I'd use it to do my kitchen extension, new kitchen and sort the conservatory out. This would free up the savings that are earmarked for those things and allow us better holidays, a better car etc
Mortgage is fine for us currently and is due to be paid off in 4 years.

Loft conversion and paying off debt.

I think this is a very valid point. You can use a proportion for fun but think much longer term. What will make your like better over time?

Financial security frees up a lot of headspace. If you know that you can manage if one of you loses their job, that you’ve paid down debts so you can focus on being able to retire early or go part time in your 50’s that is a great stress reducer.

Have a look at what overpayments do to a loan/mortgage. You can have lots of fun in the future by overpaying now, and the financial security it brings.

How much will the car cost you if you don’t pay it off now? 6.6 % of £20 k is a lot.
Do not listen to your husband and blow it all. This is your chance to really help secure your future. Pay off the car. Pay £20k off the mortgage. Keep the rest in a high interest savings account for easy access. Use the money you normally spend
on car loan and mortgage to save up for holidays and extras.

£50k is a good amount of money but it’s not life changing. Do not throw it away on crap!

Look up Dave Ramsey

Here’s what to do with a chunk of money.

one third on the past (debts)
one third on the present (fun)
one third on the future (savings)