My partner and I (early 30s) have won 100k in the lotto and we are not entirely sure what to do with it.
Always the first thought is to pay off any debt, but I feel that maybe investing or holding funds in our offset may allow us to be better off in the future…. also very boring!
Our situation is as follows
150k combined income.
700k+ VAR morgage with offset
CC and loans approx. 60k
50k combined student debt.
What would you do with the 100k?
But how else would we know about the lotto winnings?
This could be the most conclusive poll in OzBargain history.
Sharing (with ozbargainers) is caring. We will know when receiving the cheque.
I am surprised it is not in the poll options.
Reading the post I was thinking “surely they won’t have much debt beyond a mortgage and HECS/HELP”
Absolute no brainer to pay off the $60k in loans and cc.
Not exciting but gotta clear that.
yes
3 out of 4 listed in situation are debts/loans
Surely there should be an option to get "Magic beans" …
Just buy a high yield byd seal and enjoy it
Byd can't be high yield investment
It has to be European
Euro styling?
@Korban Dallas: Nah all those EVs are all bragging that they are designed by ex euro brand designers
Has to be euro and loose more than 40% of its value in the first year lol
Rank things by highest interest rate (also you don't pay tax on 'reducing interest debt' compared to investments) - and work your way down. Unless you don't want to be boring with it, in which case get into options trading.
I don’t think options trading is suitable for most people. Feel free to convince me otherwise.
The only requirement was "not boring". Losing your money overnight on one one options bet is very exciting.
Miss the 400:1 leverage.
I'd just put it all on black.
You asked a similar question in 2020, did the dream come true? https://www.ozbargain.com.au/node/531039
100k pending only. My win is also pending… Pending buying a winning ticket
There was some good predictions in that thread like
Interest rates will soar after this (covid)
They definitely got that one right
Because they handed out a lot of free money when people got covid, i know people claimed the covid money with fake covid test and also working cash in hand.
Yeah but of like of course. They were more likely to go up from ATLs
I think op needs to explain this.
Did they predict their lotto win years in advance?
I take it they inherited the 100k, which they expected since a few years ago.
It is possible this lie is to avoid their friends from identifying who they are, should they be on ozbargain.
Being anonymous on internet, i think it is a bit pointless to change the story. Also, they dont owe us any explanation.
I am even going to guess that, based on their existing debt situation, this windfall will end up making them further into debt.
But alas, if they are genuinely asking a WWYD, then i would suggest pay off high interest debt, leave hecs alone. Do i see buy 2nd property as an option? I would say revise any of their family plan before considering taking on more debts
they dont owe us any explanation.
If they made it all up then I’d like to know
What a boring fake post for OP to recycle. I can't understand the motivation behind such action.
Buy more Lotto tix?
CC and Personal loan debt are the worst things to have.
How much is it costing you in interest alone on these?
I would smash that, then put the rest into the student debt.
Once you pay down the CC be sure to reduce the credit limit if you are too easily tempted to buy more stuff you probably don't need.
You'll be in a much better position afterwards with more 'disposable' income to put in your offset and it's probably good to salary sacrifice into your super as well because you won't notice the difference.
I have very very low interest rate for our loans, one of the perks of working for a bank.
I should have mentioned this as to reason im hesistant on paying it back so quickly.
I thought there may be better options to invest the funds instead.
Ok but what about the credit card/s?
Because lies.
I feel like you're just on here looking for justification and not answers.
Wow, how did you get approved for a $700k mortgage with that income, and $60k "random debt"?
I genuinely hope that your lotto ticket wasn't bought on that CC.
The combined minimum monthly payments must be huge.
I know right, ive got a combined $530k debt in 2 mortgages (first house @ $165k (cheap country house I'm now renting to my brother cheap) and where I am now $365k house which is also in the country but further in the country side 😂)
My combined minimum weekly payments are $829
$700K would have been about right a few years ago.
cant believe how much debt you got
"win" $100k and it barely makes a dent in their debt. FFS.
Then you definitely wouldnt believe how much I had 3 years ago!
Dont think second property is an option, as you wont qualify for the loan.
Yes, I have been told its an option.
By your parish priest perchance? If those numbers are real (unlikely) you won't even be able to get a low rate credit card.
@DoUKnowTheMuffinMan: You claim to work at a bank receiving deep, deep discounts that are an FBT liability, yet you use a broker to negotiate with your own employer? I prefer to fantasise about being rich, not leveraged to my eyeballs.
Pay off your "CC and loans approx. 60k"
With 150k income, you should have pretty much no debt except for maybe your student debt which people either want to pay it off or not.
It's interesting to see how you have a 700k+ mortgage with student debt, CC and loan debt was approved. Even just calculating income + debt and no student loans or any other expenses, you're only getting approved for around 350k these days, but even in covid times, 700k+ was even a stretch with your income to debt ratio.
Approval was much higher at the time, over 1M+ actually. Its crazy to think what the banks allowed but im very grateful for it. We also had a great broker.
My partner and I have always managed it quite well over the years with no financial support needed, and still do to this day.
What is the purpose of this thread then?
OPs Personal Dick Measuring Contest.
OP here to flex thats all
My partner and I have always managed it quite well over the years with no financial support needed, and still do to this day
Why do you have $60k on personal loans and credit cards then?
A logical expanation for personal loans, could well be car loans. For example i have a 10k car loan with PCU, which is at a better rate then my either of my 2 mortgages…
Yeah, it's f'd up like that. Shouldn't be a thing where you mortgage interest rate is more then any other loan you have
@Woody982: The question still stands, if they've managed it quite well, why not buy the cars with cash? He did specifically mention credit card debt as well.
@brendanm: Exactly, if he's managed to pay down $300k of his mortgage in the past few years then it doesn't make sense to pay extra to your mortgage whilst at the same time taking out another form of debt which probably has a higher interest rate.
I am confused? I thought you said you worked for a bank, why would you be going through a broker if the bank is giving you discounted rates as a perk?
Worrying about the future is always boring until you wake up one day and realise the future is here. Start planning for it now. Investing could be worthwhile if you're certain the return will outpace your debt. If that's not guaranteed then pay off your debt and learn how you got into so much debt in the first place so you don't repeat the same mistakes. The money currently going to repay your debts can then be redirected to investments instead.
CC and loans approx. 60k
Regardless of the interest rate, if someone still has this debt after winning 100k they are having a laugh :)
If you could use the funds "better" than paying off this debt you'd have cleared out your offset and used that and additional cc debt to do it already.
Easy financial situation improvements by reducing higher interest rate loans and cc's doesn't take an ozb poll to know.
If you used the 60k for the debt, What would you do with the remaining 40k?
Either offset account and think about it, or add to other investments you may be regularly making (eg regular buys of index funds)
Though with the inflation rates in HECS debt these days, paying that off may also be worthwhile to just no longer have that as a liability
But its important you understand that you don't have a 60k debt…you have a 810k debt.
Pay it off as much as you can.
Bitcoin is the way. FIAT is for chumps
That aged well.
its up 180% for the past 12 months.. i think its aged very well
I'm not sure how my comment can be construed as anything other than a joke.
I even tried to make it less clever than usual.
@TEER3X: I think people may have overlooked that your comment was 40 minutes after the parent comment… (I'm assuming that's what the joke was: that the original comment had "aged well" in only 40 minutes, joking on the volatility of BTC? If not, then somebody *whoosh* me…)
its up 180% for the past 12 months.. i think its aged very well
It's also down 36% since Nov 2021.
Selective time windows work both ways ;)
Yes! With today's massive 7% jump it's finally reached…where it was in February 2021. Gains bro!
@ 07/01/2024 2:49 UTC, 1 BTC = 43,900.70 USDT (Tether)
@ 07/01/2024 3:30 UTC, 1 BTC = 43,951.10 USDT (Tether)
So + $50.4… not bad for 41 minutes!
Yes, it's USDT not USD, don't @ me, not a crypto-bro, just an interested monkey who can read…
So + $50.4… not bad for 41 minutes!
Minus buy/sell spread.
Wipe some of the debt!!
With all the inflation over the last few years $100k might just get you a high yield car.
Sex, drugs and rock n roll
So, like, just a normal weekend over @Jimothy Wongingtons
rock n roll
That's fine for you, Marge, but I used to rock and roll all night and party ev-er-y day. Then it was every other day. Now I'm lucky if I can find half an hour a week in which to get funky.
Pay off cc and loans, rest in offset.
What would you do with the 100k?
INB4 'Donate it to me / Give it to me / Send it to me'
Donate to the Black Dog Institute
Yeah pay off high interest debt. Invest the money you will save on debt repayments. Don't pay off any debt that will pay less than an investment will earn, like if yo mamma loaned you money interest free. Also don't tell anyone about the win or yo mamma will rightfully feel sour about not being paid back. And don't forget the tax on your winnings.
100k on black at the cass
clearly if your asking a forum for basic as.f financial advice like this, you actually might go to the cass and put 100k on black
100k on black at the cass
That's clearly poor, irresponsible advice that should be disregarded….
You should put it on red.
Holy shit, $700k mortgage, and $60k of likely high interest debt, as well as $50k in HECS on combined $150k? Nuts.
In most countries, this would be considered madness. In Australia it's encouraged.
It's called Australia dream!
You mentioned your original mortgage was over $1 million, on the same income (or lower?). So, on this income you can afford to pay close to $40k-$50k/year interest, plus living expenses, plus repayments on $110k other debt, while knocking $300k off the mortgage? If your combined income is $150k, you're taking home about $120k max. The math just doesn't add up to me.
I'l wait for your 2027 $100k winnings again.
Where's the buy $100k worth of scratchies poll option?
Works for a bank, asks random strangers how to manage his finances … fair enough
unfortunately you are deeply in debt, even with the 100k win, you need to focus on paying off the highest interest debt and ensuring you don't just replace that with more spending.
My highest interest is the mortgage
Then pay 100k of it off as you are leveraged up to your eyeballs.
Higher than the credit card debt???
what sort of interest % are you paying on your loans (non mortgage)? If its similar to your mortagage, is there a reason you havent consolidated? If you are comfortable paying off the debt you have, id be tempted to just use the extra $100k in a variety of ways. Maybe $5-10k holiday, $50k pay off some of your loan/debt, and then a mixture of super/shares (both high and low risk)/crypto and some other random investment - maybe art?
I am more concerned that you work at a bank, you have CC debt and loans up to 60K and are asking people on the internet on what to do with money.
Working at a bank doesn't automatically mean you're good with finances. Banks are large and have thousands of roles
You are not wrong. Plenty of roles that dont involve much knowledge.
But in some cases, it can also mean you learn a lot of loop holes, and get ahead where others would normally not.
So why haven't you used them
Because looking at those numbers you have a very interesting definition of "ahead"
Yeah buddy, you're not ahead by any stretch of the imagination.
All you manage to do with all these supposed loopholes is bury yourself in a debt even with minimal interest across all of it that is still an F ton of debt especially considering even with a second player you have the combined earning power of F-All.
Next you'll be selling Udemy courses on how everyone else can get "rich" like you by using these same loopholes because you just want to be "generous" but too so generous that you just freely let other knows.
I know people that work in banks, I'm betting far more senior, qualified and skilled than yourself and they don't get access to these "loopholes" of yours. So what are these loopholes? I'm sure they'd love to know. Is the loophole you letting the bosses run train on your partner at the Xmas parties?
Paying off your high interest accumulating debts is the obvious choice. It didn't need a strangers poll.