how do you know what’s right?

Ok so I have blogged about debt, kids, homes, etc. We have a dilemma I am pondering about, we like everyone have debt (i cant disclose amount right now it’s matter of national security :P) and a home, and desires to do things. We want to do so much in the world yet everything requires money. Here is the issue at hand, we are going to be coming into a small amount of money soon and cannot decide how it should be used. we have some possible scenarios but as every moment passes the scenarios change some are tossed and new ones are thought up. It is just driving me and now my wife batty: Here are the possibilities. With the money we are going to receive we can

a. Pay of debt and begin fixing up our home like we always wanted using our own money. We become debt free MUCH sooner than I anticipated (which right now is 2yrs or so).

b. Fix up our home to make it the dream house both of us have always wanted and then slowly pay off debt (this way is sure to take at least 2 to 2.5 yrs.)

c. Fix up house, sell the house for as much money as possible and use what we make from the sale to pay off debt (if there is left over that is)

So as you can see paying off debt is a part of each item but should that be most important, middle importance, or not important. Oh and the house is not falling apart so should we be concerned about repairing? Or should we just spend a bit and put the rest into savings and live life for right now. Please let me know what you think in the comments section.

–jay