Whereneverever Posted July 13, 2013 Share Posted July 13, 2013 Which of these things would you spend it on? Paying down a mortgage. Paying down student loans. Throwing it back into the house- probably installing central air conditioning and the rest into updating the kitchen. Taking a family vacation. Other- please share an idea. I have a family member who is planning on gifting us some money and I am trying to decide how best to use it. We don't have any debt other then the mortgage and student loans, or I'd throw it there. Quote Link to comment Share on other sites More sharing options...
itsheresomewhere Posted July 13, 2013 Share Posted July 13, 2013 I would take it and divide it up. Maybe some toward a vacation and apply the rest to student loans. People underrate the value of a vacation even if it is just camping. Everybody needs a few days to relax and recharge every once in a while. Or you could apply some toward a vacation, some towards student loans, and some toward savings. Quote Link to comment Share on other sites More sharing options...
Parrothead Posted July 13, 2013 Share Posted July 13, 2013 I'd take $1000 of it and go on a camping vacation in state. The rest I'd throw at debt. Quote Link to comment Share on other sites More sharing options...
Crimson Wife Posted July 13, 2013 Share Posted July 13, 2013 Do you have an emergency fund? What about retirement or college savings? I definitely wouldn't spend it on a vacation or the kitchen. A/C I might consider doing if it would make a significant difference in my quality of life during the summer. Quote Link to comment Share on other sites More sharing options...
catz Posted July 13, 2013 Share Posted July 13, 2013 If I had heavy student loans/debt, it would definitely go towards that. If my only debt was my mortgage, I might go with the home improvement project. If the vacation would be a big deal for your family, maybe I'd set aside enough for a mini vacation (2-3 days). Having an emergency fund and ongoing funding of retirement is a big deal to me too, so if you aren't doing that, I might set aside some to establish funds. Like if your car broke down, can you deal with that without paying off over time with a credit card? Quote Link to comment Share on other sites More sharing options...
Myeightkiddies Posted July 13, 2013 Share Posted July 13, 2013 If I had student loans, I'd pay those off first. Quote Link to comment Share on other sites More sharing options...
Whereneverever Posted July 13, 2013 Author Share Posted July 13, 2013 We have a good emergency fund and save monthly for retirement and college. Our student loans are small and the monthly payment is minuscule- I paid all my schooling in scholarships and grants, and so did my dh until the end of his masters. Is the kitchen really a terrible idea? I'd love to refinish the cabinets and get new counter tops... Quote Link to comment Share on other sites More sharing options...
Blessed Mommy Posted July 13, 2013 Share Posted July 13, 2013 First, I would tithe 10%. Then, I put the rest towards student debt. Quote Link to comment Share on other sites More sharing options...
lamolina Posted July 13, 2013 Share Posted July 13, 2013 Our student loan interest rate is so low that I would prefer to pay off the mortgage first. A kitchen update almost always adds value to your home, so I would not think that your kitchen upgrade is a horrible idea! Quote Link to comment Share on other sites More sharing options...
abacus2 Posted July 13, 2013 Share Posted July 13, 2013 I am a huge fan of air conditioning so that would have priority. I would allocate some portion to fun money too; maybe vacation, maybe something else. Quote Link to comment Share on other sites More sharing options...
goldberry Posted July 13, 2013 Share Posted July 13, 2013 We have a good emergency fund and save monthly for retirement and college. Our student loans are small and the monthly payment is minuscule- I paid all my schooling in scholarships and grants, and so did my dh until the end of his masters. Is the kitchen really a terrible idea? I'd love to refinish the cabinets and get new counter tops... Then I think you should finish the kitchen. It sounds like you are in a pretty responsible position financially. In that case I would do what would bring you the most joy! Quote Link to comment Share on other sites More sharing options...
Whereneverever Posted July 13, 2013 Author Share Posted July 13, 2013 Our student loan interest rate is so low that I would prefer to pay off the mortgage first. A kitchen update almost always adds value to your home, so I would not think that your kitchen upgrade is a horrible idea! Yeah, I thought it usually did? In the last two years we've gotten all new appliances (they even match!) and a brand new floor. So, if we refinish the cabinets and get new counters it's pretty much all updated. My sink is awesome and I added a new faucet this last year, as well. Quote Link to comment Share on other sites More sharing options...
Ottakee Posted July 13, 2013 Share Posted July 13, 2013 What is your mortgage interest rate? If it is higher than what you could get now and you plan on being in that house for quite a while I would take some of the money and refinance the mortgage which would lower your payments for years to come---and then you could continue to make the same payment amount and just put the additional amount on the principal . Some--like $500-1000 maybe on a family vacation. There is something to be said for those memory building times with the whole family. Then I would look at the kitchen stuff. You likely spend significant amounts of time in there daily and updating it might make your house more valuable and make your kitchen function much better. This would be after my 10% tithe as well. Quote Link to comment Share on other sites More sharing options...
LisaKinVA Posted July 13, 2013 Share Posted July 13, 2013 New mattresses for dh and I...finish the landscaping on the yard, finish the hall bath and laundry room (cabinetry), new bedding for the kids. Weekend trip somewhere with the family. Yup, that would about do it. $5000 toward a mortgage wouldn't do much. $5000 toward school loan re-payment might do more, but it really would depend on if it would really help. If I only had about $50/month to pay (and would have it paid in a couple of years), I probably wouldn't bother paying it off -- and would spend the $5,000 any way I wanted...if I had to pay $250/month and paying $5000 would allow me to reduce that monthly payment (or eliminate it altogether), I would make a different decision. I have a small inheritance coming my way...we will use some money to pay off debt and some money to buy some things for the family (new lap top for me, tablets for the kids...even some school stuff). A little "joy" can go a long way. Quote Link to comment Share on other sites More sharing options...
Pawz4me Posted July 13, 2013 Share Posted July 13, 2013 It's really hard to say w/o knowing balances, interest rates, etc. Those things are very important. If I felt that paying down the student loans and mortgage weren't big issues, then I'd put in central A/C and use anything left for a vacation if I really felt the need for one. Otherwise, use anything left to pay down the loans or start a fund to cover the kitchen updating. But really, if the loans aren't a big issue to you, then I think it comes down to what will give you and your family the most enjoyment for the money. And nobody else can tell you what that is. Quote Link to comment Share on other sites More sharing options...
Whereneverever Posted July 13, 2013 Author Share Posted July 13, 2013 What is your mortgage interest rate? If it is higher than what you could get now and you plan on being in that house for quite a while I would take some of the money and refinance the mortgage which would lower your payments for years to come---and then you could continue to make the same payment amount and just put the additional amount on the principal . Some--like $500-1000 maybe on a family vacation. There is something to be said for those memory building times with the whole family. Then I would look at the kitchen stuff. You likely spend significant amounts of time in there daily and updating it might make your house more valuable and make your kitchen function much better. This would be after my 10% tithe as well. Our rate is about 3.5% I believe. The money I'm planned to spend would be after giving to the church- we aren't a tithing denomination and we regularly give over 10%. :) The $5000 number I am working with is after paying taxes and giving out of the gift. Quote Link to comment Share on other sites More sharing options...
gardenmom5 Posted July 13, 2013 Share Posted July 13, 2013 what is your mortgage rate? what is your student loan rate? (if you elect to pay off/down a loan, you pay down the one with the highest interest rate) what rate can you get from an investment? (if you can invest at a higher interest than you're paying -you're making money) do you have something with your house that has to be done? Quote Link to comment Share on other sites More sharing options...
LucyStoner Posted July 13, 2013 Share Posted July 13, 2013 We have a good emergency fund and save monthly for retirement and college. Our student loans are small and the monthly payment is minuscule- I paid all my schooling in scholarships and grants, and so did my dh until the end of his masters. Is the kitchen really a terrible idea? I'd love to refinish the cabinets and get new counter tops... Given this information, I would do what would bring you the most joy. Be that a kitchen or a vacation or whatever. Quote Link to comment Share on other sites More sharing options...
Whereneverever Posted July 13, 2013 Author Share Posted July 13, 2013 what is your mortgage rate? 3.5% what is your student loan rate? 6.25% (if you elect to pay off/down a loan, you pay down the one with the highest interest rate) what rate can you get from an investment? (if you can invest at a higher interest than you're paying -you're making money) I really have no idea. We have so,e investments as part of my dh's compensation, but it's all managed as part of a fund. I'm not really investment savvy. do you have something with your house that has to be done? Well, we don't have central air. A lot of newer homes here do and it would be nice, but it's certainly not necessary. It gets over 90f about five times a year, I believe. I'd like to finish the kitchen, but that is cosmetic at this point. We've fixed the rest of the home up already. Quote Link to comment Share on other sites More sharing options...
Luckymama Posted July 13, 2013 Share Posted July 13, 2013 In that case, finish up the kitchen and take a vacation with your family. Neither has to be over-the-top fabulous, but you will be soooo happy with a freshened kitchen (says the person who still can't believe the difference new kitchen paint has on my mood!). Quote Link to comment Share on other sites More sharing options...
xixstar Posted July 13, 2013 Share Posted July 13, 2013 pay down debt. such a boring but practical answer. oh. well I might not put it towards student loans. I would put it towards my emergency fund savings account if debt was paid off. Quote Link to comment Share on other sites More sharing options...
Mnemosyne Posted July 13, 2013 Share Posted July 13, 2013 I'd put $2000 in the emergency fund and the rest into the highest interest debt. Quote Link to comment Share on other sites More sharing options...
Hoot Posted July 13, 2013 Share Posted July 13, 2013 If it were us we would use about $1,000 for a family vacation and use the rest to pay off the debt. Yours would be a student loan, whereas ours would be one moderate credit card bill. Quote Link to comment Share on other sites More sharing options...
emcap Posted July 13, 2013 Share Posted July 13, 2013 If you are in a good place with savings (sounds like you are), have some fun! We recently used a gift to renovate our master bath. It is awesome! And honestly, it's sweet to go in and enjoy it knowing that the gifter was so kind to make it possible much sooner than planned. We had already finished the kitchen, or that would be my choice. I love my kitchen. I think some for a vacation is nice, but I wouldn't spend more than maybe $1500. That should get a decent, fun, memory building vacation while leaving the majority for home improvement. I love home improvement. I'm home a lot and want to enjoy it. Quote Link to comment Share on other sites More sharing options...
OrganicAnn Posted July 13, 2013 Share Posted July 13, 2013 I would pay $4,000 toward Student loan (higher interest rate) and use $1,000 for whatever you can want to make your life fun/interesting. If you pick kitchen and $1,000 won't do it, then I would save the rest. I don't know how much central air would cost, but I would pick that over the kitchen. There used to be a tax rebate for certain types of energy improvements like air conditioning, but I don't know it they still have them. Quote Link to comment Share on other sites More sharing options...
unsinkable Posted July 13, 2013 Share Posted July 13, 2013 Given what you've written...i'd do the air conditioning and/or kitchen improvements. Quote Link to comment Share on other sites More sharing options...
MolleenCarie Posted July 13, 2013 Share Posted July 13, 2013 Given what you've written...i'd do the air conditioning and/or kitchen improvements. Ditto. And a small chunk towards a vacation. Quote Link to comment Share on other sites More sharing options...
trulycrabby Posted July 13, 2013 Share Posted July 13, 2013 I'd pay down the student debt. Quote Link to comment Share on other sites More sharing options...
Sahamamama Posted July 13, 2013 Share Posted July 13, 2013 Adding either AC or an updated kitchen will add value to your home and your quality of life, both now (while you live in it) and if you were to sell the house in the near future. In your situation, I'd finish off the kitchen. ;) We recently moved, and both my parents and hubby's parents gave us some money to work with, but it had to be used for "something permanent and for the house." No homeschool supplies, LOL. We bought a new sofa & loveseat for the living room, and two recliners, a new dresser, and two new nightstands for the master bedroom. I cannot begin to tell you how nice it is to have those items moved "up" several levels from what we were using before (hand-me-downs and restored trash-off-the-curb). Everything we were using is being reused elsewhere, but -- yeah -- the new stuff is so nice. Quote Link to comment Share on other sites More sharing options...
Mrs Mungo Posted July 13, 2013 Share Posted July 13, 2013 I would put it in the kids' 529 accounts. Quote Link to comment Share on other sites More sharing options...
Tita Gidge Posted July 13, 2013 Share Posted July 13, 2013 I vote for home improvements, but I'm very much a vacation kind of girl so I'd try to put some aside for that also. Even just a little bit, like a day trip. At minimum, enough to do something even more local that we never got around to doing (zoo, museum, botanical gardens, amusement park, dine-in movies, etc.) -- kind of a staycation, as much as I despise that term LOL. What a generous gift! ETA: I send my sister money every month. She's working F/T and is in college, and while I respect and appreciate that she uses my financial contribution towards "responsible" things, I'm always a bit glad when she uses a small amount to treat herself to something, too. I'd feel sad (for her) if she couldn't or wouldn't indulge every now and again :) I see your home improvements as nice extras, but if I were your gift-giver I'd be even more excited to hear you "blew it" on something fun, unexpected, and without caution towards grown-up issues (home improvements and bills)! Quote Link to comment Share on other sites More sharing options...
jewellsmommy Posted July 14, 2013 Share Posted July 14, 2013 If it has been a while (or never) since you have done a family vacation, I would do that. It doesn't sound like you are swimming in debt or living near the edge or anything like that. It doesn't have to be a big expensive trip, but I would definitely do something. Do something easily enjoyable with your dc's ages; maybe a beach trip or camping. And then you could put the rest into the kitchen. If not a trip, then maybe a museum or zoo membership? My reasoning: We used to never put money into this sort of thing (vacations or museums), but after we got ds, we realized that the time in our life where we have children is short. I like the experience of seeing things through their eyes and witnessing what they do with adventure. Plus, dh and I really enjoy the time to do fun parenting and have a break from the daily "clean your room, finish your math, Why is the cat's head wet? :huh:... " etc. The key is to keep it set up in such a way that it doesn't cause stress, or else it doesn't serve its point. Just my opinion of course. :001_smile: Quote Link to comment Share on other sites More sharing options...
BakersDozen Posted July 14, 2013 Share Posted July 14, 2013 Debt paid down/off first, absolutely. Quote Link to comment Share on other sites More sharing options...
Guest Posted July 14, 2013 Share Posted July 14, 2013 Well we don't have student loans or mortgage, so I think we would use it to get dh started on the path back into school. After 25+ years in the same field, he is realizing it is time to learn something new. Quote Link to comment Share on other sites More sharing options...
plansrme Posted July 14, 2013 Share Posted July 14, 2013 I'd put it into updating the house. I would just feel like $5000 into the mortgage isn't going to be much of a dent overall. A house update is something you will enjoy everyday since you live there almost everyday. In terms of student loans, I don't know what your interest rate is like, but mine is 2%. So again, not a huge dent there. Exactly what I was going to say. $5,000 is not going to put a dent in your mortgage or college savings, and an a/c (unless you live in Vermont) or a new kitchen will bring joy every day. I put a small boatload of found money into a new kitchen three years ago, and another boatload (relatively speaking) into landscaping two years ago, and my kitchen and my sod make me happy every single day. Truly, every time I pull into my driveway, I love my front yard, and every time I walk into my kitchen and see that 8' island, I love it. (Yes, I am that shallow.) In your stable financial position, unless the $5,000 would pay off a mortgage or other debt with a significant payment, I would use it for fun. If it were more money, on the other hand, say $50,000, I would not "blow" it--I would pay off a mortgage, contribute it to the college fund, buy a new car--something I needed, not something I wanted. Quote Link to comment Share on other sites More sharing options...
Melissa in Australia Posted July 14, 2013 Share Posted July 14, 2013 pay off or at least reduce debt will mean you have more money long term for other things. Quote Link to comment Share on other sites More sharing options...
LibraryLover Posted July 14, 2013 Share Posted July 14, 2013 Not sure. Quote Link to comment Share on other sites More sharing options...
Mommyof4ks Posted July 14, 2013 Share Posted July 14, 2013 Given that it is over 100 here much of e summer a/c would be a priority. I would do that and then go on vacation. Vacations are a priority for us, but I know they are not for everyone. My kids bring up vacation memories for years past all the time. Road trips are awesome, and they usually do not cost too much if you plan well. Quote Link to comment Share on other sites More sharing options...
Kim in Appalachia Posted July 14, 2013 Share Posted July 14, 2013 I would say kitchen and AC. Home improvement can add to the value of your home. If you have to sell your have having AC and an updated kitchen can make a huge difference. Quote Link to comment Share on other sites More sharing options...
MyThreeSons Posted July 14, 2013 Share Posted July 14, 2013 I would use it to fix up the house so we can sell it. oooops -- just realized you want advice on what you should do. I'd say get A/C done and/or fix up the kitchen. Quote Link to comment Share on other sites More sharing options...
gingersmom Posted July 14, 2013 Share Posted July 14, 2013 I would put a small amount aside for each child, go on a family vacation and put the rest into a rainy day fund. New kitchens are nice but it is family vacations that my children talk about for years. Quote Link to comment Share on other sites More sharing options...
Mom0012 Posted July 14, 2013 Share Posted July 14, 2013 I'd look at it as a windfall, so I'd spend it in whatever way brought me the most joy. For me, that might be air conditioning, but would probably mean vacations/memories with my dh and kids. Quote Link to comment Share on other sites More sharing options...
OrganicAnn Posted July 14, 2013 Share Posted July 14, 2013 What would paying down the mortgage save you? In 10 years it would save you $1,625 in interest, or $2,438 in 15 years, or $3,250 in 20 years. The longer you have remaining on your mortgage, the more you save. You have a higher interest rate on your student loan so you would save more money paying it down. If you paid all $5,000 to student loans, then you would save $312 per year in 10 years that is $3,120. And these are without the compounding effect, so you actually be saving more. You can run an amortization schedule in Excel for figure out how much you would actually save. Quote Link to comment Share on other sites More sharing options...
Violet Crown Posted July 14, 2013 Share Posted July 14, 2013 I'd pay down the medical bills. Quote Link to comment Share on other sites More sharing options...
Soror Posted July 14, 2013 Share Posted July 14, 2013 Considering the details I'd probably put it all towards student loans. Quote Link to comment Share on other sites More sharing options...
plansrme Posted July 14, 2013 Share Posted July 14, 2013 I want to add to my comment above (re. my kitchen and sod's bringing me joy every day) that between the two windfalls, we could have come close to paying off our house. We do not owe that much on it, though, and will still pay if off in a couple of years. And yes, I am looking forward to having a paid-for house, but our plan was and is to pay it off before our oldest starts college. I did not feel compelled to hit that goal two or three years early when I could plow money into it and make it more enjoyable right now, while everyone is home to enjoy it. I love Dave Ramsey and his message, but he sure can suck some joy out of a financial gift to financially responsible families. Quote Link to comment Share on other sites More sharing options...
Coffeemama Posted July 14, 2013 Share Posted July 14, 2013 Each situation is unique. So take this for what it is worth. My parents gave us $5000, and said to use it for something fun. So we went to Hawaii. But we were *already* going to Hawaii.. It just made it a free trip. We just put the $5000 we saved into investments. (it was all a silly shell game, in other words. But my parents were happier to give us Hawaii than a CD, and I see their point.) I wish they would do this again, soon. :0) A few years ago we received a gift which had strings attached that said " use this for something fun for the kids." we took a vacation with it. Quote Link to comment Share on other sites More sharing options...
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