insulating panels

[Use Less]

The garage below my back room, never used for auto storage due to a long sloped driveway and limited access to turn in, has the original wood siding. I have some blue insulation panels, and am wondering about setting them into the spaces between the studs. I wouldn't necessarily seal it up more than that, at least for now.  Dad may have had ideas of turning that into a finished room. The wall next to the cellar rooms was insulated with fiberglass and drywalled. I don't have a need for another living space, and have other projects that would make more difference to me. Is this a good idea? Any reasons I should not? 

[Deleted]

Is the ceiling/floor insulated, if not that may be a better use. If the ceiling is insulated, is the garage heated? If not may need to watch for condensation depending on area you are in. Could trap moisture....James

[Use Less]

Thanks, James. The floor is concrete, but quite broken up. The bottom of the drywall on the finished wall is some 8 inches up, so I think Dad planned to put some other floor in. The ceiling was insulated well and is enclosed with drywall to make the little breakfast room above snug. The panels may not even fit in all the spaces, since the studs are set rather randomly.

[Maura]

If you use styrofoam you can cut it to size. I would probably use blown in cellulose, then drywall over it. Otherwise, 2" styrofoam, then drywall over it. If the garage smells musty I would deal with that before doing anything else.