You received an inheritance. If your first instinct is to spend—wait! You’ll need a plan if you want to use it wisely.  After the I-just-got-a-ton-of-money craze settles, let the inheritance sit for a while longer. Hold back from random and uncalculated spending. No matter the amount, if you want the money to last, you’ll need a plan.

Pay Down Debts and Create Emergency Fund

Did you know more than one-third of inheritors see no change or even a decline in their wealth after receiving an inheritance? That’s right, if used incorrectly it could hurt you. Once you’re ready, detail your current expense needs.  Debts? If you seek more financial freedom in the future, it’s always a good idea to pay off high-interest or high-balance debt.  In addition, use some of the money to create or add to an emergency fund. You’ll want a minimum of 6 months expenses to keep you covered for any of life’s surprises.  

Set Aside Money for an Education

If you have children, grandchildren, or anyone you’d like to help out in the future, put some money aside for their college education. We all know tuition is expensive, so helping out with the burden is a great way to set them up for good financial health. Despite the amount, there are options to stretch the generous gift such as a 529 plan.

Pay Down Mortgage

Do you have a mortgage? Consider paying some of it off. This can also give you financial freedom in the future—leaving more for your pocket! Freeing up some or all the money contributed towards your mortgage can allow your retirement savings to grow to a larger scale for an easier retirement.  


Giving even a small amount to charity can make a huge impact. Humble yourself while helping others by donating to a cause you believe in. Bonus: you’ll also get a tax savings for any donations! And if the account requires an RMD, a donation can be applied towards that amount if done correctly.


 Investing a portion of the inheritance may help stretch the money. There are many vehicles to invest with, make sure you’re choosing the right one for your unique situation and goals. What’s the best way to accomplish that? Meeting with a financial advisor.

Don’t forget to enjoy some of the money! After all, it was left to help ease your financial burdens. Once you’ve paid any debts, saved some, invested a bit, don’t be afraid to spend a little on yourself! Depending on how much you have left, take that family Disney trip! Or splurge on the deck renovation you’ve been saving for—treat yourself! 


Now that you have an idea of what you want to do with the money, you’ll need a concrete plan. Whether you want a professional to draw this game plan or not, seeking their advice is important. There are many aspects you probably aren’t familiar with or may forget. Did you know only a select amount of states impose an inheritance tax? New Jersey readers—this applies to you! A good financial consultant can advise you with the knowledge to keep you out of legal trouble while making the most of your money. 

Do you need guidance with your inheritance? Click the button below, call 1-800-467-8152, or email to schedule a time for us to chat!