How would you handle a cash windfall?

First, do not….. I repeat…… do not let it fall through your fingers!  You will regret being foolish.

So that you know where you are with paying down your debts, put the windfall into a new checking account.  Doing so will allow you to see at a glance your payments towards those debts and also how well you’re doing at getting them all down to zero.

Make a list of all your debts….. every one of them…… then put them in order of amounts with the smallest amount first, largest last.

Next check the interest rate you’re paying for each, and put those in a second list with the highest rate first.

Pay the smallest debts first to get them completely off the list(s).  And don’t use that institution again.

Now, call the other institutions to see if you can lower the interest rate on your account and ask if they’ll work with you to pay it off quickly.  Also ask if there is any pre-payment fee…. most will say no, but it’s best to ask.  There is no need to mention to them that you’re working with other debts.

Have them direct withdraw the money from the new checking account….or you can write a check (but be disciplined each month and don’t be late with the payment).

Once your debts are paid off, and your debt free, put what is left in savings and continue adding to that savings on a regular basis.

Remember, ALWAYS pay yourself first!!