From Yahoo Finance: 2025-03-26 18:05:00

Credit card debt in the US reached $1.21 trillion in Q4 2024. A financial windfall, like a tax refund or inheritance, could help pay off debt. Using windfall money to tackle credit card balances can save thousands in interest. Evaluate your financial situation and priorities before deciding how to use the money.

Over 40% of Americans lack emergency savings for expenses over $1,000. A windfall could kickstart an emergency fund. Consider paying down student loans or boosting retirement savings. Parents saving for college worry about future costs. Adding windfall money to savings can help alleviate concerns about inflation and rising education expenses.

Debt consolidation loans and balance transfer cards are options to reduce credit card debt. A consolidation loan can lower interest costs, while a balance transfer card offers a 0% APR for a set period. Using a windfall to pay off debt can save money in the long run. Consider all options carefully before deciding how to utilize extra cash.

Read more: Should I pay off credit card debt with a financial windfall? What to do with extra money.