Reddit Student Loans

Inherited money

Hi everyone,

I currently owe 68k in gov loans with interest rates between 3-6%. I have unexpectedly inherited 40k…I have never seen this much money in my life…and my gut is obviously telling me to pay off my debt with it all. However, I am very inexperienced with money matters and I’m wondering if it would be smarter to pay off some loans, then invest/save/make a down payment with the rest. I just finished grad school so I have about 8k in cash to my name between checking and savings – no property and no 401k. Besides loans my only other debt is my car (12k left). My job prospects are good and I am going to be making in the 70-80k range each year.

I know it’s probably best to talk to a financial advisor about this but until I can find the right one I’d like to hear everyone’s opinion about how they would use this money. Thanks for reading!

Inherited money – RobinHood – Reddit Feed


View Reddit by sosmoreView Source

discover student loans
student loan calculator
student loan login
private student loans
student loan payment
reddit student loan forgiveness
student loan nightmare stories
reddit pslf




sallie mae
myfedloan
discover student loans
student loan forgiveness
average credit card debt
average student loan interest rate
best way to pay off student loans
best private student loans reddit
average student loan debt by age

About the author

reddit personal finance

11 Comments

  • First, keep a small emergency fund (at least $1,000). Second, keep a small amount for transitioning from college life to professional life. For example, you may need to move for a job, security deposit for apartment, small amount of professional clothing items, etc. I would say $5,000 is good here depending on your personal situation. You already seem to have sufficient savings so the third step is to pay off the debt starting with the loan with the highest interest rate.

    As far as building wealth and investing you should first contribute at least up to your employers match on 401k. That’s free money. Paying off debt is the next step. You can’t invest aggressively if Sallie Mae is sleeping in your spare bedroom and Ford financing is sleeping in your garage. Kick them out and then you have access to your number 1 “wealth building tool” which is your income. Without payments eating up that tool you can save very aggressively and invest aggressively and the earlier you can do both the wealthier you will be.

  • I’d probably hold onto it until you get a job. Don’t buy unnecessary shit, just set it to the side and keep living your life had you not received that money.

    Once you secure a job and see what that income looks like, then I would probably put a significant amount towards loans… like maybe 30k? Paying off the car is tempting too, but the loans probably are accruing more interesting.

    Perhaps you could put the rest into a retirement fund and start contributing to that account with your paychecks?

    This is all assuming you have an emergency fund, etc.

  • I would not spend that money until I had a job secured. You might need some of it to live off of and/or move.

    Once that’s done I’d pay off any loan above 4% interest. Then I’d max out an IRA, set up my 401k to get the max match, and re-evaluate based on how much money was left over (if any).

  • Check out the personal finance sub. There is a guide for when you receive a windfall. $1000 in an emergency fund, 3-6 months worth of expenses in the event you’re unemployed, then I’d probably pay off debt starting with any loan that’s accruing over 4% interest – car loan included.

Leave a Comment