October 26, 2022

Even when you’re expecting a significant transfer of wealth from a loved one or a friend, it can be overwhelming to receive this and to decide what to do next. Working with a knowledgeable financial planner is a good way to address many common questions and avoid common pitfalls.

Being prepared in advance reduces the possibility of spending too much of an inheritance or mismanaging it so that you harm yourself in the future. One of the best ways to plan for the receipt of this wealth is to work with a financial professional who can discuss how this fits into your estate, retirement, and other personal financial plans.

Many adult children recognize that their parents, grandparents, uncles, and other family members have worked all across their life to generate this wealth, and so it is natural for these adult children to be concerned about losing the inheritance.

That being said, they may also have financial concerns they need to address sooner than later. Hiring an experienced financial professional can help you answer these three important questions that will guide the strategy for how you address a major inheritance. These include:

• Are there any immediate purchases or you want to make or debts you need to pay down?
• Are there any assumptions about who should receive these funds, such as a relative, sibling, church or other organization?
• How would you feel if you spent all of the money, or would you be concerned that you did not honor the legacy of the person who left you these assets?

Working with an experienced financial planner makes it easier to create a unique plan aligned with your goals and intentions.