Receiving an inheritance is both an honor and a responsibility, and estate planning attorneys constantly see individuals who are just not ready to take that on appropriately. Unlike items of sentimental value, such as jewelry or family heirlooms, a financial inheritance was likely meant to be used toward your own monetary goals. The temptation to simply spend away an inheritance as “bonus” money can be strong, but there are a whole lot of very practical means by which to manage the funds for your own future.
When you receive an inheritance, you should look at how it fits into your overall financial plan. Are you saving for a particular purchase, working toward paying off debt, or building a retirement fund for yourself? These are all potential uses for the money which has been left to you. You should also be aware that inheriting the funds may have tax implications. Your Savannah estate planning attorney will be able to guide you when it comes to ways of reinvesting or living off of the inheritance in order to minimize the amount of taxes you will need to pay.
The types of inheritance you receive can certainly vary, with stocks, bonds, bank accounts, and insurance benefits all being possibilities. The different types of sources and dispersal of funds may be governed by certain rules or laws. For example, many people are surprised when their Savannah trusts and estates attorney tells them they can have a limited amount of time to withdraw funds from an inherited retirement account, like a 401(k), 403 (b), or and IRA. The rules and regulations won’t be the same for every type of account, but if you don’t find out what they are, you can end up paying a lot of penalties and fines out of the money you’ve inherited.
There may also be times when you feel you don’t need the money as much as another beneficiary and are willing to forego your share. This might be for altruistic reasons or simply to protect your own tax situation. In this case, you can work with your estate planning attorney to properly disclaim your inheritance. Doing something along these lines can allow the money to “flow” through you and to another beneficiary, possibly even one of your own children.
When it comes to managing your inheritance, there can be many complications to work through, and one of the best ways to minimize confusion is to work with a qualified attorney. Remember the type of inheritance, your future goals, your tax situation, and even whether or not you “need” the inheritance will all come into play when determining what is the best route for you to take.
Our attorneys are ready to answer your questions and assist you with the implementation of your financial goals. To schedule a complimentary consultation with the mention of this article, simply call our office at (912)352-3999 or email firstname.lastname@example.org.