Should I pay off my credit cards with my windfall, or put it in the bank?

Do not close up the old accounts.
This hurts credit in 2 ways.
- It can delete your oldest credit card. Length of credit history is 15% of your fico.
- It will reduce the overall unused credit card limits you have.
Creditors like to see a lot of unused credit.

Leave them open. If the banks want to close them themselves, let it be so.
I've had a Discover account unused for 10 years now - never touched it - still open.
For good credit I would continue using the cards to show usage and keep your rating.
I would charge food in one and gas on another and pay in full each month.
This will keep the credit card company happy since they make up to 5% from the merchant on each purchase you make.

Of course pay them off.
It makes absolutely no financial sense to pay interest on credit cards.
When you pay in full each month you never pay interest.
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your credit cards are costing you about $8/month in interest
if by some miracle you get 1.5% for a bank CD for the $1000, you will only be receiving about $1.25/month in interest income, so you will just keep going deeper in debt

pay off the debts, you will still have $400 left over PLUS the money you no longer have to pay the credit card companies each month , which is probably $45/mo - ($15 min payment x 3 cards) - that $5/mo can then be added to whatever else you can save each month to save for a car - with a credit score of 590, you are a long way from getting a decent int rate on a car loan, so getting that debt paid off will help in that area also - do NOT close out the cards, just pay off the balances

Look at it this way...any savings account you open, traditional, CD, bond or whatever, is not going to match the interest rates you are paying on those cards, so you will be losing money in the long run.

Pay them off. Then never go over 30% of your total credit limit at any time or your FICO score will suffer. If you like to shop, never charge more than you can pay off in a month. Do not close the accounts. Account history is important to your FICO and if you have any other open accounts with balances, closing out credit lines increases your debt to income ratio, causing your FICO score to drop.

Saving is great and recommended for everyone, but first priority is to get out from under existing debt. Then start up a savings plan.

Definitely pay off the balances. The interest rate on the cards is much higher than what you can earn in a bank account. In the long run, you'll pay more interest than you'll make.

If you have a problem managing your credit card debt, closing the accounts is the right thing to do. Paying in cash only will make you much more aware of how much you're spending.

With those interest rates, I'd pay them off in full. You'll still have some of your payout, which can go towards your car, or whatever.

Um, but why are you going to close those store credit accounts? If they've been opened for over a year, I wouldn't; that's history.