7 Steps for Effectively Managing an Inheritance

Research shows that a majority of baby boomers will receive an inheritance at some time during the lives, with the average inheritance estimated at almost $65,000.  Should you be the recipient of family largesse, here are 7 steps you can take to be sure your inheritance is managed wisely:

1.  Re-examine your financial goals.  This should provide you with the direction you need to determine how to invest your inheritance, either for short-term gain or long-term benefit.

2.  Review your estate plan.  If you inherit a significant amount, you will need to review your estate plan to see what strategies can be put into place to protect your increased assets.  If you inherit a valuable collection of art or jewelry, you’ll need to look into ways to protect that, too.

3.  Get rid of debt.  If your inheritance is significant enough to allow you to pay off debt – especially credit card debt or loans with high rates – be sure to consider paying it off.  You can evaluate whether or not this is a good idea by estimating what you currently pay in interest and then determine if investing your windfall will provide a better return.

4.  Have an emergency stash.  If you do not have at least six to eight months’ worth of living expenses in an emergency fund, it’s a good idea to park some inheritance money there.

5.  Take your time.  Take the time to consider the best use of your inheritance before you may any major moves.  Inheritances are separate marital property, so if you are headed for divorce, it may be more prudent to just put the cash in an interest-bearing account until the dust settles.

6.  Consult a professional.  A financial planner and an estate planner are good choices to help you navigate your new wealth.

7.  Give yourself a treat.  Put a small amount by for a special “treat” but don’t go overboard.

Jill Gregory, Personal Family Lawyer®, can further advise you of all your options as part of a comprehensive estate plan.  If you would like to have a talk about estate planning for your family, call our office at 530-581-5455 today to schedule a Family Wealth Planning Session with Jill Gregory, your local Tahoe City Personal Family Lawyer®.

This article is a service of Jill Gregory Law, a Personal Family Lawyer® firm. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Life and Legacy Planning Session™, during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by clicking the button above or calling our office today at 949-514-8842 or 530-581-5455, to schedule a free 15 Minute Phone Consult with Jill Gregory, or a full Planning Session today. Mention this article to find out how to get this $750 Life and Legacy Planning Session at no charge.

The content is sourced from Personal Family Lawyer® for use by Personal Family Lawyer® firms, a source believed to be providing accurate information. This material was created for educational and informational purposes only and is not intended as ERISA, tax, legal, or investment advice. If you are seeking legal advice specific to your needs, such advice services must be obtained on your own separate from this educational material.