<prompt> Human: Hey everyone! Im hoping for a little guidance here. Im about to inherit 40k from my grandfathers life insurance policy. He was so great to me when he was alive and hes now helping me posthumously. I love him. Anyway, I have about 29k in student loan debt after graduating in May. I have 4k in credit card debt, and about 2.5k in miscellaneous debt still owe my university after graduating in May, have a few outstanding medical bills. With the life insurance policy I can pay everything off and be debt free. But that leaves me with almost no money, because I am a stay at home mother without income. I would love to finally be able to help my boyfriend with our familys expenses mortgage, bills, maybe a new car payment which I wouldnt really be able to do if I used all of the life insurance money on my personal debt. I would also like to treat my boyfriend to something nice because hes always buying me things. Im thinking about putting a few thousand away in an interest bearing account or bonds for our son. I want to buy my parents and brother some nice things, too.I just dont know what to do. Im young and Ive never had any large sum of money like this. My boyfriend is a bit older and very financially responsible. The problem is, if I were to spend X amount on gifts for him, while he would enjoy it, I know in the back of his mind he would consider it X more money he has to spend on one of my bills. That takes some of the fun out of spoiling him, but I know he wont spoil himself.Basically my question is: Should I use the amount to pay off all my debt and be left with a few grand, or should I do something else with it?Any advice is appreciated, and I will take into consideration anything you have to say. However, I dont know how I feel about investing. I did read the sidebar and the I have X...What Do I Do With It? link, but I dont know... Thank you in advance!  <response>: This is what I would do:1. Set up an emergency fund of roughly 6 months of living expenses if you dont already have one. roughly 12,000 if you spend 2k per month2. Pay off the credit cards and the miscellaneous debt in full.3. Set aside 1,000 so to do something nice with your BF. Try to do something instead of just buying something, you get more for your money that way. My suggestion would be a nice long weekend trip for the two of you, while hiring a good sitter for the kids.4. Throw all remaining funds at the student loans.That will leave you with about 8,500 in student debt, but I believe its a slightly better approach that simply paying everything off.I know people will criticize me, but the reasoning is this: Paying off 100 debt is pointless if it puts a person at a high risk of immediately going into more debt. An emergency fund is very important.As for taking a small amount and doing something for yourself... well, everyone needs a bit of a mental relief. Personally I think taking a small amount is worth it. 