What should I do with my $10K windfall, given these options?
I think you've got competition on that list for where to put the money - I'd work out which option is costing me the most currently or will cost me the most in the future and take care of it. I'd be willing to bet that Eric is right, though, that it will need to be the roof. Not fixing it could cost you more in the long run than any of the other items on the list (assuming your circumstances remain roughly the same).  General comments/other considerations: Any money that doesn't get spent on the roof (if any) - I would put in a rainy day fund. "I've been listening to Dave Ramsey a lot lately, and he encourages (encourage might be too light of a word for him) this priority list for budgeting: I would strongly advise you to tackle this list before you start to think about any sizable ""fun"" spending.  If you don't have #1, set that aside first. The options you mentioned: New roof: You should ask yourself ""what is the potential cost of not getting a new roof?"" If you can save up for it a little at a time, while putting most of the rest of your money to paying off debt, that's what I would do.  Unless, of course, there is damage or risk of damage to your house by not doing it now. Then, you need to do the same measurement (of doing the roof now) against the goal of saving three to six months of expenses.  Especially in your case, with your mortgage underwater, you want to be sure you are prepared should anything happen (for example, losing a job, and potentially being forced to move for a new job). Cars/student loan: (Refer to #3 above — in other words, yes)." As much as I'd like to tell you to save some for an emergency fund or use it to pay off some debt, if you really need a new roof you should get that taken care of first. If you need a new roof because your house is full of buckets that fill up every rain :) then that's most likely the item at the top of the list. If you need a new roof because you don't like the color, I'd do something else with it. If you are in the US and the 'education loan' has the same caveats attached as your average student loan, I would eye that one with intent if the roof can soldier on for a few years as is. The simple reason for this is that a student loan would be the one debt that you list that you can never get rid off unless you actually pay it off, no matter what happens (IOW student loans aren't bankruptable). Disregard this if the caveats in the first sentence don't apply... I recommend fixing the roof. You're going to pay for it eventually, either as an emergency repair or a concession at sale. Hard to give an answer without knowing more details (interest rates, remaining principle on loans, especially how soon the new roof is needed).  Maintaining the value in your home (unless you are planning to walk away from it or short-sell or something) is of paramount importance, and the cost of a leak should it happen can be substantial. If the roof is a few years out, and you have loans with interest rates about oh I'd say around 6%or more then I would pay off those loans and take the money you were paying there and start putting it into a fund to pay for the roof. I am also a huge fan of doing whatever you can to max out your 401K contributions.  Money put into a 401K early has a LOT more value than money put in later, and since you don't pay taxes on it, the cost out of your pocket is much lower (eg. at a 20% tax rate it costs you only $80 out of pocket to put $100 into your 401.. (look at that, you just made like 25% return on that $80) Paying off loans is pretty much equivalent to making a risk free return on the money equal to the interest rate on the loan.  But to REALLY make that work, what you need to do is in a virtual sense, keep making the loan payment just now pay it to yourself, putting that money into a savings account, or towards your 401K or whatever.  If you just torn around and start spending that money, then you are not really getting as much value to paying off the loan early. Have you looked at DIY roof repair?  Caulking with tar adhesive, and shingle replacement isn't that hard, if you're in good health.  Totally depends on how bad your roof is/what the demands on it are going to be.   If you can squeak another year out of it, with minimal investment, you'll have a year's worth of, say car-debt (at what percent interest?) to put into your roof fund.
You owe $10k at 18% and borrow an additional $10k at 0. When you pay back $10k, they are likely to apply it to the zero rate money and you are out 2%. Your question has merit, but as others say, the devil is I'm the details. You should read the fine print.  My credit card checks forbid drawing a check payable to myself. I need to pay another account, in my case easy to 'pay' my HELOC, then draw the funds. "Uniform Transfer to Minors Act (UTMA) and Uniform Gift to Minors Act (UGMA) accounts in the United States are accounts that belong to your child, but you can deposit money into.  When the child attains his/her majority, the money becomes theirs to spend however they wish.  Prior to attaining their majority, a custodian must sign off on withdrawals.  Now, they are not foolproof; legally, you can withdraw money if it is spent on the child's behalf, so that can be gamed.  What you can do to protect against that is to make another person the custodian (or, perhaps make them joint custodians with yourself, requiring both signatures for withdrawals). UTMA/UGMA accounts do not have to be bank savings accounts; for example, both of my children have accounts at Vanguard which are effectively their college savings accounts.  They're invested in various ETFs and similar kinds of investments; you're welcome to choose from a wide variety of options depending on risk tolerance.  Typically these accounts have relatively small fees, particularly if you have a reasonable minimum balance (I think USD$10k is a common minimum for avoiding larger fees). If you are looking for something even more secure than a UGMA or UTMA account, you can set up a trust.  These have several major differences over the UGMA/UTMA accounts: Some of course consider the second point an advantage, some a disadvantage - we (and Grandma) prefer to let our children make their own choices re: college, while others may not prefer that. Also worth noting as a difference - and concern to think about - in these two.  A UGMA or UTMA account that generates income may have taxable events - interest or dividend income.  If that's over a relatively low threshhold, about $1050 this year, those earnings will be taxed (on the child's own tax return).  If it's over $2100 (this year), those earnings will be taxed at the parents' tax rate (""kiddie tax""). Trusts are slightly different; trusts themselves are taxed, and have their own tax returns.  If you do set one of those up, the lawyer who helps you do so should inform you of the tax implications and either hook you up with an accountant or point you to resources to handle the taxes yourself." "You state ""Any info will be appreciated"", so here's some background information on my answer (you can skip to my answer): When I worked for banks, I was required to submit suspicious activity to the people above me by filling out a form with a customer's name, SSN, account number(s) and ID.  You may hear in media that it is $10K or sometimes $5K.  The truth is that it could be lower than that, depending on what the institution defines as suspicious.  Every year we were required to take a ""course"" which implied that terrorists and criminals use cash regularly - whether we agree or disagree is irrelevant - this is what the course implied. It's important to understand that many people use cash-only budgets because it's easier than relying on the banking system which charges overdraft fees for going over, or in some cases, you pay more at merchants because of card usage (some merchants give discounts for cash).  If someone has a budget of $10K a month and they choose to use cash, that's perfectly fine.  Also, why is it anyone's business what someone does with their private property?  This created an interesting contrast among differently aged Americans - older Americans saw the banking system as tyrannical busybodies whereas young Americans didn't care.  This is part of why I eventually left the banking system; I felt sick that I had to report this information, but it's amazing how quick everyone is to accept the new rules.  Notice how one of the comments asks you what you intend to do with the money, as if it's any of their business.  Welcome to the New America©! My answer: If you withdraw $100,000, here is what will more than likely happen: Now, watch the anger at this answer because I'm telling you the truth.  This article will explain why.  Your very question had a negative 1, as if asking what you're asking is wrong (see the absurdity)!  If Joseph Stalin ran for president in the United States, the majority of Americans would welcome him.  You have good reason to be concerned; others at this site have noticed this as well." "Accounts track value: at any given time, a given account will have a given value. The type of account indicates what the value represents. Roughly: On a balance sheet (a listing of accounts and their values at a given point in time), there is typically only one equity account, representing net worth, I don't know much about GNUCash, though. Income and expenses accounts do not go on the balance sheet, but to find out more, either someone else or the GNUCash manual will have to describe how they work in detail. Equity is more similar to a liability than to assets. The equation Assets = Equity + Liabilities should always hold; you can think of assets as being ""what my stuff is worth"" and equity and liabilities together as being ""who owns it."" The part other people own is liability, and the part you own is equity. See balance sheet, accounting equation, and double-entry bookkeeping for more information. (A corporate balance sheet might actually have more than one equity entry. The purpose of the breakdown is to show how much of their net worth came from investors and how much was earned. That's only relevant if you're trying to assess how a company has performed to date; it's not important for a family's finances.)" You do not need to set this up as a loan. Try finding an Indian student. He is eligible to get cash (using a travel card, may be) from India tax-free. As long as it doesn't exceed the i-20 amount, he will not have any problems. Since, $10,000 is very small amount, the student shouldn't be having any problem. I'm going to offer a contrarian answer. Depending on how big the jackpot is, I would suggest that your best bet might be the annuity over the lump sum. Not because of math, but because of behavior.  Let's say that you are looking at a jackpot of hundreds of millions, and the annuity option is tens of millions each year. For me, even the annual payment of the annuity is more money than I can even comprehend. Do I trust myself to handle the lump sum? No. I have no experience with that kind of money, nor does anyone I know. By taking the annuity option, I allow myself to figure it out a piece at a time. If I make a mistake by choosing the wrong advisor or spending more than I should, I can learn my lesson and do better with next year's payment.  There are too many stories of past lottery winners who blow it all early and end up broke. The annuity option protects you from yourself.  But, you don't have to take my word for it: New York Times, Jan 12, 2016: Dear Powerball Winner: Take Our Advice and Take the Annuity You are only 33, with plenty of time to generate long-term returns. A correction is an opportunity for you to buy more at a lower price. My advice: invest about half in an index fund (S&P 500, for example) and half in a target fund (pick your retirement age), keep saving regularly, and in 30 years you'll be very happy you did. 5-10K a month is fine until all of the money is invested. (You said this is a retirement account, so invest the entire amount. Keep a rainy day fund in your non-retirement savings.) You can fiddle around with how you invest the money and I'm sure you'll get variations on my answer. My above suggestions may not be the absolute best option, but they are certainly not the worst option. Given that you are very risk-averse, keep in mind that you are in this for the long term and should be investing in something where you can safely ignore short-term downswings. You're creating more liabilities for yourself in the future, although yes this could definitely be a profitable move for you. However, some small mistakes you made, from what I can see using the tools at Hargreaves Lansdown. The first, is that the government relief would only be 20%, not 60%. The second is that the tax relief goes directly into the SIPP, it's not something you get given back to you in cash. In order for this to be worthwhile, you need to be sure that you can make a post-tax gain of more than 3.4% on this money per year - which should be very feasible. It sounds like you have enough security that you could afford to take this risk.