Help with modest inheritance

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Meaty
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Help with modest inheritance

Post by Meaty » Wed Apr 25, 2018 2:28 pm

I’m receiving an inheritance from a deceased extended family member of approx. $54,000 after taxes. Here’s my situation:

Debt - 200k mortgage at 3.625%. No other debts
Retirement - 401ks, Roth’s, HSA all fully funded. Adding around $2,000/month to taxable as well.
Emergency fund - 6 months expenses

I’m unsure what to do beyond simply adding to taxable according to my current allocation. Paying down the mortgage doesn’t yield a huge benefit given the low rate and fact the inheritance is insufficient to retire the debt completely

Thanks for any thoughts
"Discipline equals Freedom" - Jocko Willink

soccerrules
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Re: Help with modest inheritance

Post by soccerrules » Wed Apr 25, 2018 2:31 pm

Kids - 529 ?
Near Term Needs ? (Car, Roof, Remodel, Repair)

Maybe add a little to your EF, set a little aside for Vacation and then rest to taxable.

Sounds boring, but boring is OK.
Don't let your outflow exceed your income or your upkeep will be your downfall.

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Meaty
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Re: Help with modest inheritance

Post by Meaty » Wed Apr 25, 2018 2:38 pm

soccerrules wrote:
Wed Apr 25, 2018 2:31 pm
Kids - 529 ?
Near Term Needs ? (Car, Roof, Remodel, Repair)

Maybe add a little to your EF, set a little aside for Vacation and then rest to taxable.

Sounds boring, but boring is OK.
Thanks. I should have added I have a 529 for my son on track to slightly underfund college (which is my goal so I don’t over save and get penalized).

There’s a few “upgrade” items I could do to the house but don’t want to “blow” the funds on material items. I like your boring suggestion and simply achieving FI a little sooner
"Discipline equals Freedom" - Jocko Willink

delamer
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Re: Help with modest inheritance

Post by delamer » Wed Apr 25, 2018 9:35 pm

You could consider doing a mortgage “recast.”

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LadyGeek
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Re: Help with modest inheritance

Post by LadyGeek » Wed Apr 25, 2018 9:44 pm

This thread is now in the Investing - Help with Personal Investments forum (portfolio help).
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Darth Xanadu
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Re: Help with modest inheritance

Post by Darth Xanadu » Wed Apr 25, 2018 10:02 pm

soccerrules wrote:
Wed Apr 25, 2018 2:31 pm
Kids - 529 ?
Near Term Needs ? (Car, Roof, Remodel, Repair)

Maybe add a little to your EF, set a little aside for Vacation and then rest to taxable.

Sounds boring, but boring is OK.
Good advice! :beer
"A courageous teacher, failure is."

Lafder
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Re: Help with modest inheritance

Post by Lafder » Wed Apr 25, 2018 10:30 pm

Paying down the mortgage that much even without a recast would make a huge difference in how fast your house is payed off with the exact same payments you are making now. Maybe seeing how far ahead on payoff it gets you will be better than boring :)
lafder

Darth Xanadu
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Re: Help with modest inheritance

Post by Darth Xanadu » Wed Apr 25, 2018 10:39 pm

Lafder wrote:
Wed Apr 25, 2018 10:30 pm
Paying down the mortgage that much even without a recast would make a huge difference in how fast your house is payed off with the exact same payments you are making now. Maybe seeing how far ahead on payoff it gets you will be better than boring :)
lafder
I can't disagree, but at the same time, putting into say taxable still affords this option whereas putting towards mortgage doesn't really see any payoff until the new payoff date. And if OP can beat mortgage rate in taxable (50/50 shot? not sure...) then OP is in better position generally.

Again, I don't think paying down mortgage is a mistake, just chiming in with a different angle.
"A courageous teacher, failure is."

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