What to Do with an Inheritance

An inheritance is a bittersweet gift. Though it can provide a much-appreciated financial windfall, it comes at the price of a loved one. In most cases, the deceased individual who has bequeathed this inheritance will want it to improve the lives of those he or she left behind. There are a number of things you can do with the inheritance that will perpetuate the memory of the deceased in a positive way along with helping you meet your financial goals.

• Invest It
• Give Back
• Pay off Debt
• Enjoy Some of It
• Pay off Your Home
• Plan for Retirement
• Start a College Fund
• Get Help Managing It
• Don’t Let It Change Your Life
• Share It with Family Within Limits

It’s important to realize that creating a will helps make sure your intended inheritance gets into the right hands. In most states, you will need to sign your will in the presence of two adult witnesses who have no vested interest in your inheritance. These witnesses may initial each page of the will or sign an addendum stating that they watched the testator sign the will. When a person dies with a will in place, they are said to die testate. When they die without a will, they are said to die intestate and dying intestate will put your estate (that is, the assets you leave behind) through a process called probate. Initiating a conversation with elderly loved ones about the importance of leaving behind a clear will can be a difficult conversation. Each person will have to decide what makes sense for them but initiating this conversation may prevent intended beneficiaries from having to go through extra grief and stress. Probate can be a lengthy process, and attorney’s fees can eat away at the inheritance. If dissatisfied relatives want to assert a claim on the assets of the deceased, they can further drag out the probate process. This, of course, adds to all the stress and sadness of dealing with a loved one’s demise, but if the deceased has created a satisfactory will with clear directives, beneficiaries listed in the will may suddenly find themselves with a sizable sum of assets. It’s then up to them to use this money wisely.

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Work cited: David Gass, July 16, 2020

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