How To Make The Most Of Your Inheritance

If an unexpected inheritance suddenly becomes part of your financial picture, it’s important to act wisely before you impetuously put any of that new-found money into play. In fact, your first move should be to find the best tax lawyer available. He or she can point you in the right direction and advise you on how to make the most of your money.
Delay Delay Delay
While the thought of certain luxuries may be dancing in your head after receiving unexpected money, those purchases should wait until you are in the all clear to buy what you want without spending more than your new budget can handle.
 
Many experts will say to stop short of this scenario for at least a few months, if not more. During that time, you will be advised by your tax lawyer to put those inheritance monies into either a high-yield savings account or a balanced mutual fund.
 
Then, step back and ponder. Decide what your goals are with regard to finances before you make another move.
Bad Habits Die Hard
For instance, do you have any bad habits with regard to spending, like unplanned purchases or fleeing the scene on quick trips to alluring (and expensive) destinations? Well, don’t give in. Instead, hold back and work with your IRS tax attorney before even touching the windfall you were lucky enough to be given.
 
While you do this, don’t even think about quitting your job without first consulting your financial expert. He or she will probably suggest you slow down with any extravagant plans until the scope of your newfound wealth is truly understood.
 
A cash flow analysis will likely tell you a lot about what you can spend and what you cannot. This is true both in the long term and in the short term.
In An Emergency
Another area to be addressed is with regard to any emergencies that may come your way. For that, these fresh funds will be more than helpful, especially if you concoct an emergency account with the assistance of your tax lawyer.
 
When you consult with this professional, you and your advisor will decide just how much money you will need to keep you afloat for a certain amount of time, be that three months, six months or even a full year.
Debt Alert
One more aspect of your financial situation to consider with your tax attorney is the debt you owe at the time of your inheritance. Savvy experts will tell you to pay down at least some, if not all of the money you owe in order to satisfy your student loans, your current mortgage and your credit card overload.
 
Remember, if you keep on living with that money owed hanging over your head, you could be paying off that debt long after the inheritance money dries up. Indeed, sometimes when you pay too slowly, all you are doing is paying interest on the money you actually owe.
The Long Run
And finally, think about your future in terms of your retirement. Would some of this newly acquired money be better used at that point rather than at the present time? The answer to that last question is probably a resounding yes.
 
So, it’s important to listen to all of the ideas your tax attorney gives you before you take off for Tahiti or purchase a Lamborghini with the money you inherited.
 
Who knows? You may be able to do one or both of those things, too – after you put at least a good portion of that money in the right place. Meanwhile, good luck and congratulations on being given financial options you may have never even dreamed were possible.
By Ellen Chadwick
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