Do a skewed balance, but also know that you can recover from loss of job, house, but you can't recover from a loss of retirement funds.

List your interest rates, highest to lowest. Then fraction it out where most goes to the highest interest rate and less goes to the lower. Also, retirement should never drop below priority #2, it is very difficult (or expensive) to recover later and protected, if something goes bad people can go after your house and assets but not your retirement. Do not draw from it to buy your first house either.

Let's say after listing it looks like the following:

Credit Card: 12.99%
Stock Market (retirement): Typically nets 6-9%
Mortgage: 5.875% (but you can claim it on taxes so it's actually less)
Money Market: 3% (you pay taxes on gains so it's less)
Savings: 2% (also pay taxes on interest earned so it's less)

If your situation is like the above, a skewed balance would be $15,000 to your credit card, $5,000 to a Roth IRA (Roth IRA's are likely the better bet than IRA's in your situation), and $2,000 into a Money Market account because you do need a rainy day fund. I actually recommend putting the $2,000 into an account the money can only be wire transferred from, it will take several days to wire it so it's not as easy to make splurge purchases or think it's available right now. Once the CC is paid off focus on retirement 1st (since it should net 6-9% tax free on gains) followed by perhaps getting into the stock market, and some into a money market account.

That will net you bang for your buck. Don't lose sight of mixing it up, what happened to me was I focused on the stock market because it was doing great and skipped my mortgage and money market. The stock market went negative, had I been contributing some into my mortgage and money market I'd have had some gains to offset the losses. Then my son needed medical attention I didn't have enough in my rainy day fund and had to charge it on my credit card which has a higher interest rate than anything else. I will never be focused on one thing again.

If it were me I would pay off the cc balance immediately. Problem solved. Then slowly build up that emergency fund.

I always follow the Dave Ramsey rules to a "T" when it comes to inherited money. Get a small emergency fund, it can be 1-5 grand. Then pay off as much debt as you can, with what's left with the money from the inheritance.

Good luck!

Thanks everyone for your opinions. I am in favor of using most if not all of the money for paying off the credit card debt. My husband, on the other hand, feels we should use about 1/3 for debt and save the rest. I am having trouble convincing him that we would be better off paying the debt, because he really wants this money to last, and not just be "poof" and gone with a couple of mouse clicks. However, with my income I pay my monthly credit card bills (minimums plus extra for chipping away at my highest interest card) and that is a little over a third of my monthly income gone. The rest is used for groceries, gas, etc. (My husband pays the mortgage and other household bills with his paycheck.) So if we paid off the debt, we could use that extra third of my income every month for savings. And, in my opinion, that would be better, because if we pay off the debt now, rather than later, we would save on paying all of that interest. We could pay off the debt now, and I could save let's say $600 a month. In three years, we could have $21,600 put away, plus be debt free.

Here is a breakdown of my credit card debt.

A) Balance: $1,224.35 Int. Rate: 32.99% (This one I definitely am going to pay off because the interest is so damn high. And the company folded anyway so I can't keep it open if I wanted to.)

B) Balance: $3,671.28 Int. Rate: 14.99%

C) Balance: $592.75 Int. Rate: 22.99% (Also am definitely paying this one off. It has a small limit ($700) and high interest. No need for it.)

D) Balance: $3,775.18 Int. Rate: 13.24%

E) Balance: $6,092.52 Int. Rate: 18.99%

F) Balance: $3,538.83 Int. Rate: 26.99%

G) Balance: $4,440.96 Int. Rate 25.24%

Grand Total: $23,335.87

Plus my husband has a card with about $1,700 on it with interest rate in the 20s. (Not sure because he pays this one.)

So I have $22,000. I need about $3,000 aside for sure because I have a car that needs a repair which I'm guessing is about $1,000, and we have a shed we're building ourselves (well really my dad and husband are) and we need about $2,000 to finish it I think. So that leave me with $19,000. How would you use it to pay off my debt? Which cards would you apply it to and how much would you pay on them?

Thanks for reading my very long post. I am just kind of overwhelmed and want to use the money the absolute best way I can if at all possible.

U can invest some in gold market or purchasing department.

Actually Dave Ramsey would say this:

1. $1000 emergency fund
2. Pay off debts smallest to largest.
3. Put away 3-6 months emergency fund for expenses
4. Put 15% into retirement.
etc.....

Wow, how can your husband look at all of the cc's and not be freaked out. That would drive me absolutely nuts. Not sure how you can make someone who is free spirit realize that what he is doing is a bad idea.

I guess you can try to settle your credit card debts and then think about something that you can invest on

Set aside a little for emergency, pay off the debt. You'll sleep better at night - trust me.

Put a small amount aside for emergencies and then pay off as much of the debt as possible. Use the freed up money to continue to snowball the debt until it is gone. Then start investing part of your income for the future. Thats what I would do.

However it sounds like from your post that you and your husband keep seperate accounts and each pay certain bills as one persons responsibility or the other persons...You have mentioned your husband has 1 small credit card debt and you have a much larger amount, you also mentioned this inheritience came from your husbands side of the family....You two need to sit down and discuss why he wants to save the amount he has mentioned? Is he afraid of paying down your debt because he fears your lifestyle won't change and will take on the debt again? Financially your direction makes more sense however it doesn't sound as you and your husband are working towards the same goal. You need to get on the same page financially, is he aware of the staggering amount of credit card debt you are currently carrying? I only ask because your not certain about his debt.

From the sound of it, you are living beyond your means. You need to address that before deciding how to spend this inheritence. And as far as paying the cards off, no matter the balance, pay the highest interest accounts first and cut up the cards. Do not close the accounts, as that looks detrimental to your credit history.

I would agree on you more... Thanks.. It really help out!

What do you do with a large windfall, like an inheritance?

My answer would be: to further along your financial goals, WHATEVER they may be...

There are people who work diligently, month after month, who are paying down their debt... and they they receive a cash windfall. So what do they typically do with it?

THEY BLOW IT!

They treat the WINDFALL money differently than they do the money that they earn simply because it came from a different SOURCE. WHY IS THAT?

Usually.. the person feels that the windfall was a gift.. and since they didn't earn it, they somehow feel like they didn't deserve it, and so they spend it.

It is any wonder why people who win the lottery end up broke again?

The better thing to do.. it to treat ALL money the same.. regardless of where it came from. Take the windfall and PLUG it into your financial goals..

If you're currently saving for a car.. take the windfall and add that to your savings..

If you're trying to pay off a credit card... take the windfall and pay off your credit card.. and maybe the next one too.

Should you spend any of it on yourself?

Sure.. why not?

Take a small part of the windfall and treat yourself.. and put the rest into your plans..

The problem is spending ALL of it.

What kinds of windfalls happen in your life?

Work Bonuses.. Tax Returns.. Inheritances.. Insurance Claim money (after the repairs are done)... Radio Contests.. the list goes on...

Money can come to you unexpectedly... you deserve it.. but don't sell yourself short by blowing it.