When people receive a windfall, I recommend people do these things (in order):
1) Max out your 401K/403b contribution to get the dual benefit of saving pre-tax dollars, and reducing taxable income.
2) Max out your HSA account (must have a HDHP to have an HSA account).
3) Max out a T-IRA or ROTH IRA contribution.
4) Invest in a taxable account.
5) Add $100-to-$200 extra principle payment each month. OR... calculate how much you would need to pay on the mortgage to pay it off just before you reach your FIRE date. (IF going into FIRE with no mortgage is a goal for you).
Paying down principle is at the BOTTOM of that list because it's like burying $$ in a jar. Sure, you're essentially paying into an asset that pays back whatever your interest rate is... but a house is not a liquid asset (you only see ROI from a house increasing in value by SELLING it). Instead, invest it, and see regular returns on that $$ via stock price increases & dividends. And always buy low-cost Stock and/or Bond ETF's such as the one's offered at Vanguard/Fidelity.
