What to do with windfall

colsten

wmb194 wrote: »

I think writing "kappa" means that it is a joke.

I don't speak kappa, so didn't know. I reckon I am not alone.

george4064

I agree with what others have said that its really down to how you and your partner feel about the situation, your circumstances, goals etc..

If in doubt its generally considered a safe option to do a bit of everything, like you said perhaps split it into various pots that are important to you. Perhaps a 1/3 on house improvements, 1/3 on ISAs and 1/3 on mortgage.

eskbanker

wmb194 wrote: »

I think writing "kappa" means that it is a joke.

Looks like you're right, as per https://www.urbandictionary.com/define.php?term=Kappa:

The main symbol/emote of Twitch.tv. It represents sarcasm, irony, puns, jokes, and trolls alike. If you see this term used outside of Twitch.tv, then this is not the correct definition. Usually used at the end of an ironic or sarcastic sentence. Sentences that contain a Kappa should not be taken seriously. If you search "Kappa Twitch.tv" in Google you can see what the emote looks like, and why it is used as it is. Sentences that use Kappa do not always have to make sense.

So, it would appear that appending 'kappa' in posts should be interpreted as 'ignore this drivel'....

Albermarle

A couple more questions/points for the OP.
Your own work/pension situation is not clear. If you are taxpayer and/or your employer may match any increased contributions , then you should at least start to increase your monthly contributions and/or make a lump sum contribution . This would especially apply if you are a higher rate taxpayer. Although pension pots are not accessible until at least age 55, they are usually the best way to build up a retirement pot due to the tax relief and employer contributions.
Second point is that pensions and S&S ISA's are only tax wrappers . The money is actually invested within them , usually in funds linked to financial markets . You need to be sure that the money is invested in suitable funds for your age/situation/risk profile .

[Deleted User]

Hi Albermarle -

Thanks for your question. Income is from self employment and won't have employer matched, otherwise pension would be our obvious. We are both 'just' sitting under higher rate taxpayer threshold currently, but if / when we go over then we may need to look more at pensions instead. But for now after a lot of advice I think S & S Isa may be the way for us.

Husband and I have sat down and chatted a lot further today and we feel like a weight has been lifted and we think we've made a decision.

We are going to go ahead and spend about 25k on the refurbishments and outside office we really need but without the extension for now. We are then going to reduce our mortgage to under £100k but keep the mortgage payments the same as currently to reduce the term straight away. The remaining money will be put in to EF and S & S ISA. We feel really comfortable with this balance and then we will spend any additional savings monthly probably put straight into ISA each month.

I really appreciate everyone's thoughts here!

Thanks again.

foofi22

Deleted_User wrote: »

We are then going to reduce our mortgage to under £100k but keep the mortgage payments the same as currently to reduce the term straight away ....

Maybe it's already been mentioned, but make sure you don't exceed any overpayment limits if they apply to your mortgage.

Primrose

Deleted_User wrote: »

Hi Albermarle -

Husband and I have sat down and chatted a lot further today and we feel like a weight has been lifted and we think we've made a decision.

We are going to go ahead and spend about 25k on the refurbishments and outside office we really need but without the extension for now. We are then going to reduce our mortgage to under £100k but keep the mortgage payments the same as currently to reduce the term straight away. The remaining money will be put in to EF and S & S ISA. We feel really comfortable with this balance and then we will spend any additional savings monthly probably put straight into ISA each month.

I really appreciate everyone's thoughts here!

Thanks again.

This sounds like a very good compromise to me. You're addressing all the issues which concern you, getting the office and reducing your mortgage to a manageable amount whilst addressing the issue of some retirement funding. Keeping your mortgage payments at current level will make quicker inroads into getting that paid off more quickly.

I,m sure whoever bequeathed you the money would rejoice that you're spending their hard earned money in an equally sensible way and I hope this give you some peace of mind for the future in a sometimes very uncertain world.

atush

Employer matching or not- look at pensions. Tax efficient.

120K is a LOT to spend on your current house. Have you consulted an agent to see how much your house will rise in value? I suspect it wont be 120K. Consider somehting more moderate.

As said above, do a bit of a lot of things. Pension, Isas, some home improvements.

And you say this is an early inheritance. If the giver dies before 7 years, there will be tax to pay. So save this amount.

kangoora

I'd think long and hard before adding an extension.

Could it mean your house will hit the ceiling cap for your area thereby not gaining the full benefit of the cost on resale?

You're both 36 and had children young, presumably they are now in their teens? Could you make do a few more years as they could be leaving home then and you will have an extension without building it?

Finally, is an extension a NEED or a WANT - it's tempting when flush with money to confuse the two quite easily.