Sunday, August 24, 2014
Oftentimes a sense of guilt is associated with an inheritance after a loved one passes. “Most people are not prepared for the emotions that come with an inheritance . . . It’s different than winning the lottery. When you win the lottery, you’re excited. With an inheritance, it’s bittersweet.”
One of the biggest mistakes made when people inherit money is not thinking it through, “People who don’t have means often squander the money on things they have been dying to have all these years, and then it’s gone.” This usually wastes a good opportunity as an inheritance can move a struggling worker from just getting by to financial security. “Instead of funding a splurge like a Porsche, that money can better be used to pay down the mortgage or kids’ college, creating long-term security.”
There are a few things you should remember when an inheritance comes your way. Firstly, do not make hasty decisions, slow down and do not invest right away. It is smart to take a “cooling off period,” and put aside the money until you can think about your long-term goals. It can often be helpful to consult a financial planner or attorney to minimize your tax burden and plan for the long term.
See Julie Landry Laviolette, Inherit? Invest, Miami Herald, Aug. 22, 2014.