Inheritance and paying off debt - Updated post 24

[Mrs. Ciz]

I am going to go against the grain here...

I say invest the whole inheritance in an account you will not touch. Lock it away for a very long time! Keep paying off you credit cards as you had planned without the inheritance money. Yes, it will cost you more in interest than paying them off now, but I would still do it that way. A large lump sum of money is VERY hard to build and so easy to spend. Most people will make sure they pay their bills, but often, even with the best intentions, will not ever completely pay themselves back (or save money) because things always come up. The mindset often becomes if you don't pay the cc company, you get in trouble, if you don't pay yourself, no big deal.

A lump sum inheritance is one key to building family wealth, the kind that grows through compounding and can be passed on from generation to generation. In addition, I have always had a very hard time justifying spending inheritance money on any non appreciating asset (bills, cars, vacations). Once it's gone, it's gone.

Again...just wanted to give you a totally different perspective.

 

[2disneyboys]

I would pay them all off, put anything extra into savings and then start putting that $ you are not paying the credit card companies into savings.. every extra penny.. once you reach your "comfort" emergency fund amount, then you can continue putting $ into savings or towards other goals, but ease up a bit and give your family extra breathing room for fun stuff.

But, that's just me... YMMV! (Sorry for your loss!)

 

[MrsPete]

I'm going with the flow here . . . pay off 1, 2, 3, and invest the rest . . . but keep it in some type of investment that'll allow you to pull out cash if something should prevent you from paying off 4 before that 12% interest hits you.

Then continue paying what you're now giving to the credit card company into your own accounts . . . and continue what you've already begun: No adding to the debt.

 

[bettymae1121]

Update:

I received the check yesterday afternoon, and it was quite a bit higher than I anticipated. It's enough to pay off all the CC debt and still leave just a bit less than half the inheritance in savings! It's amazing that within the next few weeks we'll be credit card debt free with an 8 month emergency fund!

Thank you everyone for your advice!

 

[SaraJayne]

Update:

I received the check yesterday afternoon, and it was quite a bit higher than I anticipated. It's enough to pay off all the CC debt and still leave just a bit less than half the inheritance in savings! It's amazing that within the next few weeks we'll be credit card debt free with an 8 month emergency fund!

Thank you everyone for your advice!

That's wonderful. Enjoy the extra breathing room.

 

[navywifetill2002]

Update:

I received the check yesterday afternoon, and it was quite a bit higher than I anticipated. It's enough to pay off all the CC debt and still leave just a bit less than half the inheritance in savings! It's amazing that within the next few weeks we'll be credit card debt free with an 8 month emergency fund!

Thank you everyone for your advice!

First off, sorry to hear about the loss of your mom then grandma.

Congratulations on being debt free! It's such a good feeling to have that savings to fall back on as well.

 

[Planogirl]

I'm sorry to hear about your mom and grandma too but congratulations on being debt free. I know that you must be relieved about that.

 

[nunzia]

Update:

I received the check yesterday afternoon, and it was quite a bit higher than I anticipated. It's enough to pay off all the CC debt and still leave just a bit less than half the inheritance in savings! It's amazing that within the next few weeks we'll be credit card debt free with an 8 month emergency fund!

Thank you everyone for your advice!

 

[disykat]

You meet Suze Orman's standards!

 

[Rosebud123]

Not much interest to be earned these days in a bank. I'd pay it off, save the rest and get the debt monkey off your back.

ITA! Then close 3 of the accounts and just keep 1 for emergencies.

 

[DisneyMissy318]

OP - sorry about your losses - I know having your precious daughter's grandmothers in her life would have trumped any $$ amount.

Congrats on no debt!! We just came in to a little money and were able to take a huge chunk out of our debt - and are a roll to get the rest paid down quickly! Even though we still have "some" - paying off what we did was a great feeling!