Where should I put $10k

[stugger]

I have $10,000 dollars from a CD that was cashed out. I have had advice telling me to put it into a Roth index annuity fund, advice telling me to keep the cash, and my gut feeling is to put it toward principal on some real estate that I own in order to get it close to payoff. I realize that I would lose the tax write off but on the other hand I would pocket an extra $500.00 per month without the burden of the payments. I'm open to all ideas. Thanks

[kork13]

How old are you, and what does your retirement picture look like right now? Roth/401k/etc. balances and saving plans?

I'd most likely recommend putting $5k of it into your Roth (and the other $5k into your spouse's Roth, if you're married). However, avoid anything with the hint of "annuity". Hopefully, your current retirement assets are set up in an investment allocation that you're comfortable with, in which case you just need to add the cash to your Roth according to that investment plan. If not, you need to figure out your investing plan first, then invest the cash.

If/when you've maxed your Roth(s) and have extra cash, paying down your home loan could be a good idea, assuming you don't have any other debt (credit card, student loans, etc.). Never get convinced that you should delay paying off your debts for a tax write-off. I guarantee that the principal and interest payments you'll save over the course of a year would far outweigh any possible tax deduction/credit.

[disneysteve]

Welcome. As kork has alluded to, you haven't given us nearly enough info to answer your question. What you should do with this $10,000 depends entirely on what the rest of your financial picture looks like. How old are you? Do you have any debt? How much are you currently saving toward retirement each year? Are you married? Any kids?

[stugger]

Thank you for this outlook. I will speak with my financial people regarding the finer details in your responses. I am not married so I figure a split between mortgage lowering and IRA investment may be the way to go.

[mcfroggin]

What is your mortgage rate?

[Nightfly]

Keep at least a grand or two in cash for a bit of cushion - put it in an online account like ING Direct; that way it's a day or two away from your hot little hands so that you won't spend it unless you really have to...

[prsims]

I'm with Nighfly- keep some cash for an emergency fund if you don't have one. Otherwise, pay off your credit cards or real estate.

[thefrugaltoad]

I agree. First priority should be 3-6 month emergency fund in a liquid money market account. Then pay off higher interest debt.