What to Do with a Windfall

[QofQuimica]

Curious to know what those of you who get sign-on bonuses, yearly bonuses, inheritances from long-lost relatives, etc. do with that money. Or, if you haven't received a windfall but have imagined receiving one some day, what would you do with it? Let's not go crazy and fantasize about winning the PowerBall; say we're talking about a windfall more in the range of $50,000 here.

I think I would just divide the money up and allocate it to my various goals in the same proportions that I'm already doing each month. So it would essentially be like I'm earning a few extra paychecks all at once.

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[NICUfello]

SIGNING BONUS- I used 80% of it towards downpayment of house+some furniture etc, and 20% into emergency fund.

YEARLY BONUS-Since I live during the year "without it" I would be putting 100% of it in retirement account.

INHERITENCE-My parents have been wanting to leave me a house of theirs (current value $500k), and my spouse would get 3 houses of her parents (combined value $2M). Me and my spouse are self made, and both sets of our parents were very hard working and self made.

We have made it clear OVER AND OVER that we don't want the inheritence money, and they should enjoy it in their life. I hope they take our thoughts to heart.

However, IF we get the inheritence, since we have made a life "without" counting on it, we would put it in a trust to pass down to our children. We wouldn't spend it.

Do I want a Lamborghini? ABSOLUTELY! But I want to earn it with my own money, not "Free" money I get from my folks.

 

[Spydra]

What would I do with a windfall of 50k? Hmmm after taxes and tithing, I'd spend a third on savings, a third on debts, and a third on regular/semi-regular expenses.

 

[jakeislove]

I'd pay some bills and have a good night's sleep, LOL!

 

[sazerac]

Curious to know what those of you who get sign-on bonuses, yearly bonuses, inheritances from long-lost relatives, etc. do with that money. Or, if you haven't received a windfall but have imagined receiving one some day, what would you do with it? Let's not go crazy and fantasize about winning the PowerBall; say we're talking about a windfall more in the range of $50,000 here.

I think I would just divide the money up and allocate it to my various goals in the same proportions that I'm already doing each month. So it would essentially be like I'm earning a few extra paychecks all at once.

As coincidence would have it, I just got a windfall in the range of $50,000. We've decided to turn it into $2,000 per month of extra income. I'm just starting MS-3, so about the time this bonus income vanishes, my wage income as a resident will kick in. This windfall is easing my transition into residency, if you will. We can really use the cash now because we recently had another child.

I am also expecting a second windfall ten times as large when I am a PGY2. That is going straight into the Vanguard "FU" fund where we withdraw 1% every 3 months for living expenses. It will generate approximately $2,000 in additional monthly income, cost of living adjusted, forever.


If you are asking what I would have done with a $50,000 windfall if I already had an attending-sized and constant income, I probably would put it into the Vanguard FU fund. A $10,000 windfall would just vanish into the chaos of a family checking account, but I think $50,000 is worth saving.

 

[PL198]

I'd put it in somewhere extremely low risk for 6-12 months, plan what I'm going to do with it and then carry out that plan. Sometimes when people come across money, they go bat**** crazy figuring out what to do with it and end up making a bunch of dumb decisions, when there really wasn't any rush to do anything with it at all. I'm ok with losing some return on potential investments over 6-12 months if it prevents me from doing something extremely stupid with the windfall.