Need help with investing court claim cash

Mellers

Hi all

I am about to receive £25,000 from a medical negligence claim. Of course I am pleased because I can now get out of debt, but would like some advice about what to do with what will be left, to benefit most. I don't want it all to get frittered away to be left in the same position as I am right now this time next year.

Here's what I plan to do as soon as I have access to the cash:

pay off Cahoot loan £5,000 (ish)
pay off credit card £1,300

left over: £18,700

I do want to get a little car - I've never had one of my own I suppose I will be left with roughly £15,000 after tax and insurance and so on.

I have an ISA with Alliance and Leicester. I haven't put anything in it this year yet, so if I get my money in time, I want to put £3,000 in there before April 5th.

Should I then put another £3,000 in there after April 5th, or is there a better way to invest the remaining £12,000?

I am also in receipt of Working Tax Credit, since I'm on a low wage. Do I declare this lump sum to them, or does the Credit simply work on my income rather than any savings I might have?

I appreciate all replies!!

Thanks,
Mellers

blinko

first pay off your credit cards and loans they must be expensive !

i would use this years tax free savings up first and then when april hits put another 3k in this will give you about 6k @ 5% returning £300 net interest, the stock market may return better but is a higher risk eg you may get less than you put in !

also for isa's you dont need to declare them on any tax returns etc