I received an inheritance of 120K. So far I paid off our second mortgage. I also paid off all credit card debt. I have 80K left. This is the biggest payout we will likely ever receive. My husband works full time and earns a modest salary. We aren't low income but we are just scraping by. I am a grad student and not earning any income currently. I am acquiring student loans. I owe 16k in loans currently and will owe about 45K total when finished. I will get a decent job when I am done. My husband and I are 46 and we have 2 kids, ages 11 & 7. I want to get my older son into a private middle school for 2 years. They have a hardy endowment and may offer us a decent need based scholarship if we look worthy on paper. I don't know how inheritance will look to them, and I want to make decisions that will best support getting generous aid from them.
We still owe 238k on our 30 year mortgage. I am tempted to switch to a 15 year mortgage and just try to pay if off as quickly as possible. At the same time, our house is a major fixer. It needs a lot of expensive work to just become an average house. It's not a great place to live and I don't think we can afford anything better in our area. We also want to start a college fund for the kids. We have a modest retirement set up, with husband paying to meet maximum matching.
Should I use the money to pay off student loans and future grad expenses for me? Should I put money into fixing the house or just try to make payemtns to own it outright in 15 years? What would you recommend in light of trying to improve our chances of making 2 years of private middle school attainable for our son? Thanks!