If you’re in line to inherit money or assets from a late loved one’s estate, there are a few important steps you can take to help you plan and prepare. Here are some things to consider before receiving your inheritance.
Get organized
Organize all the legal and financial documents you’ve collected for easy reference.
Inventory your assets and liabilities
Assess your changed financial situation, specifically your net worth—the difference between your assets and your liabilities—to help you determine new goals and financial plans.
Consider working with a team of professionals
As with many financial matters, consulting a financial or tax advisor, as well as an estate planning attorney, could be helpful.
Take your time
Consider avoiding making any major decisions within the first year, such as investing lump-sum inheritances, or insurance or pension payouts depending upon your situation.
Park your money
Until you’re certain, consider keeping your money safe and secure. For some people, it's better to lose some potential return in a low-interest account than to take major risks or make financial moves without considering taxes or your entire financial picture.
There are a few options, including modest interest-paying certificates of deposit, money market accounts, or Treasury bills, to name a few—though for the longer term, these kinds of investments may be too conservative. Consider consulting a financial professional to talk through your specific scenario.
Learn the basics of investing
If you’re an investing novice, consider learning more. The world of investments can seem overwhelming at first, but becoming more knowledgeable can help you feel confident about your future choices.
